Disclosures and legal compliance

Department of Commerce | Final Report 2016–17 | 51

Disclosures and legal complianceContains the department’s audited Financial Statements and Key Performance Indicators for the year ending 30 June 2017.

The section also provides details on required disclosures and legal compliance obligations, including financial and performance management, accountability, governance and annual reporting required under specific legislation administered by the department.

Audit Opinion 52

Financial Statements 57

Statement of Comprehensive Income 58

Statement of Financial Position 59

Statement of Changes in Equity 60

Statement of Cash Flows 61

Schedule of Income and Expenses by Service 62

Schedule of Assets and Liabilities by Service 63

Summary of Consolidated Account Appropriations and Income Estimates 64

Notes to the Financial Statements 65

Key Performance Indicators 119

Ministerial directives 139

Government policy requirements 165

52 | Department of Commerce | Final Report 2016–17

Audit Opinion

Independent Auditor’s Report

To the Parliament of Western Australia

Department of Commerce Report on the Financial Statements

OpinionI have audited the financial statements of the Department of Commerce which comprise the Statement of Financial Position as at 30 June 2017, the Statement of Comprehensive Income, Statement of Changes in Equity, Statement of Cash Flows, Schedule of Income and Expenses by Service, Schedule of Assets and Liabilities by Service, and Summary of Consolidated Account Appropriations and Income Estimates for the year then ended, and Notes comprising a summary of significant accounting policies and other explanatory information, including Administered transactions and balances.

In my opinion, the financial statements are based on proper accounts and present fairly, in all material respects, the operating results and cash flows of the Department of Commerce for the year ended 30 June 2017 and the financial position at the end of that period. They are in accordance with Australian Accounting Standards, the Financial Management Act 2006 and the Treasurer’s Instructions.

Basis for OpinionI conducted my audit in accordance with the Australian Auditing Standards. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Department in accordance with the Auditor General Act 2006 and the relevant ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to my audit of the financial statements. I have also fulfilled my other ethical responsibilities in accordance with the Code. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Key Audit MattersKey audit matters are those matters that, in my professional judgement, were of most significance in the audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters.

Recognition and measurement of Home Indemnity Insurance (HII) liabilityIn November 2013, the State assumed responsibility, on an emerging cost basis, for HII claims arising from the death, insolvency or disappearance of a builder or building group. In November 2016, this arrangement was extended to November 2018. Premiums are paid into an account administered by the department and claims are met from the account. This matter was significant to my audit because the valuation of the HII liability involved actuarial and management judgement. In addition, this liability was material to the financial statements. My audit procedures included assessing the valuation methodology and the reasonableness of the assumptions made by the actuary and by management. Based on the audit procedures performed, I concluded that the valuation methodology was adequate. The administered liability of $38 million at 30 June 2017 is included as part of Other Current Liabilities at Note 49 of the financial statements.


Responsibility of the Reporting Officer for the Financial StatementsThe Department of Commerce ceased to exist as a department under the Financial Management Act 2006 on 30 June 2017. The Treasurer appointed a Reporting Officer under section 68 of the Act who was responsible for the preparation and fair presentation of the financial statements in accordance with Australian Accounting Standards, the Financial Management Act 2006 and the Treasurer’s Instructions that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility for the Audit of the Financial StatementsAs required by the Auditor General Act 2006, my responsibility is to express an opinion on the financial statements. The objectives of my audit are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

As part of an audit in accordance with Australian Auditing Standards, I exercise professional judgment and maintain professional scepticism throughout the audit. I also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,

intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the agency’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Reporting Officer.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

From the matters communicated with the Reporting Officer, I determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in the auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because of the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefit of such communication.


Report on Controls

OpinionI have undertaken a reasonable assurance engagement on the design and implementation of controls exercised by the Department of Commerce. The controls exercised by the Department are those policies and procedures established by the Director General to ensure that the receipt, expenditure and investment of money, the acquisition and disposal of property, and the incurring of liabilities have been in accordance with legislative provisions (the overall control objectives).

My opinion has been formed on the basis of the matters outlined in this report.

In my opinion, in all material respects, the controls exercised by the Department of Commerce are sufficiently adequate to provide reasonable assurance that the receipt, expenditure and investment of money, the acquisition and disposal of property and the incurring of liabilities have been in accordance with legislative provisions during the year ended 30 June 2017.

The Director General’s ResponsibilitiesThe Director General was responsible for designing, implementing and maintaining controls to ensure that the receipt, expenditure and investment of money, the acquisition and disposal of property, and the incurring of liabilities are in accordance with the Financial Management Act 2006, the Treasurer’s Instructions and other relevant written law.

Auditor General’s ResponsibilitiesAs required by the Auditor General Act 2006, my responsibility as an assurance practitioner is to express an opinion on the suitability of the design of the controls to achieve the overall control objectives and the implementation of the controls as designed. I conducted my engagement in accordance with Standard on Assurance Engagements ASAE 3150 Assurance Engagements on Controls issued by the Australian Auditing and Assurance Standards Board. That standard requires that I comply

with relevant ethical requirements and plan and perform my procedures to obtain reasonable assurance about whether, in all material respects, the controls are suitably designed to achieve the overall control objectives and the controls, necessary to achieve the overall control objectives, were implemented as designed.

An assurance engagement to report on the design and implementation of controls involves performing procedures to obtain evidence about the suitability of the design of controls to achieve the overall control objectives and the implementation of those controls. The procedures selected depend on my judgement, including the assessment of the risks that controls are not suitably designed or implemented as designed. My procedures included testing the implementation of those controls that I consider necessary to achieve the overall control objectives.

I believe that the evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Limitations of ControlsBecause of the inherent limitations of any internal control structure it is possible that, even if the controls are suitably designed and implemented as designed, once the controls are in operation, the overall control objectives may not be achieved so that fraud, error, or noncompliance with laws and regulations may occur and not be detected. Any projection of the outcome of the evaluation of the suitability of the design of controls to future periods is subject to the risk that the controls may become unsuitable because of changes in conditions.


Report on the Key Performance Indicators

OpinionI have undertaken a reasonable assurance engagement on the key performance indicators of the Department of Commerce for the year ended 30 June 2017. The key performance indicators are the key effectiveness indicators and the key efficiency indicators that provide performance information about achieving outcomes and delivering services.

In my opinion, in all material respects, the key performance indicators of the Department of Commerce are relevant and appropriate to assist users to assess the Department’s performance and fairly represent indicated performance for the year ended 30 June 2017.

The Reporting Officer’s Responsibility for the Key Performance IndicatorsThe Reporting Officer is responsible for the preparation and fair presentation of the key performance indicators in accordance with the Financial Management Act 2006 and the Treasurer’s Instructions and for such internal control as the Reporting Officer determines necessary to enable the preparation of key performance indicators that are free from material misstatement, whether due to fraud or error.

In preparing the key performance indicators, the Reporting Officer is responsible for identifying key performance indicators that are relevant and appropriate having regard to their purpose in accordance with Treasurer’s Instruction 904 Key Performance Indicators.

Auditor General’s ResponsibilityAs required by the Auditor General Act 2006, my responsibility as an assurance practitioner is to express an opinion on the key performance indicators. The objectives of my engagement are to obtain reasonable assurance about whether the key performance indicators are relevant and appropriate to assist users to assess the agency’s performance and whether the key performance indicators are free from material misstatement, whether due to fraud or error, and to issue an

auditor’s report that includes my opinion. I conducted my engagement in accordance with Standard on Assurance Engagements ASAE 3000 Assurance Engagements Other than Audits or Reviews of Historical Financial Information issued by the Australian Auditing and Assurance Standards Board. That standard requires that I comply with relevant ethical requirements relating to assurance engagements.

An assurance engagement involves performing procedures to obtain evidence about the amounts and disclosures in the key performance indicators. It also involves evaluating the relevance and appropriateness of the key performance indicators against the criteria and guidance in Treasurer’s Instruction 904 for measuring the extent of outcome achievement and the efficiency of service delivery. The procedures selected depend on my judgement, including the assessment of the risks of material misstatement of the key performance indicators. In making these risk assessments I obtain an understanding of internal control relevant to the engagement in order to design procedures that are appropriate in the circumstances.

I believe that the evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

My Independence and Quality Control Relating to the Reports on Controls and Key Performance IndicatorsI have complied with the independence requirements of the Auditor General Act 2006 and the relevant ethical requirements relating to assurance engagements. In accordance with ASQC 1 Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, and Other Assurance Engagements, the Office of the Auditor General maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.


Matters Relating to the Electronic Publication of the Audited Financial Statements and Key Performance IndicatorsThis auditor’s report relates to the financial statements and key performance indicators of the Department of Commerce for the year ended 30 June 2017 included on the Department’s website. The Department’s management is responsible for the integrity of the Department’s website. This audit does not provide assurance on the integrity of the Department’s website. The auditor’s report refers only to the financial statements and key performance indicators described above. It does not provide an opinion on any other information which may have been hyperlinked to/from these financial statements or key performance indicators. If users of the financial statements and key performance indicators are concerned with the inherent risks arising from publication on a website, they are advised to refer to the hard copy of the audited financial statements and key performance indicators to confirm the information contained in this website version of the financial statements and key performance indicators.

COLIN MURPHY AUDITOR GENERAL FOR WESTERN AUSTRALIA Perth, Western Australia 14 September 2017


Financial StatementsCertification of Financial Statements for the year ended 30 June 2017

The accompanying financial statements of the Department of Commerce have been prepared in compliance with the provisions of the Financial Management Act 2006 from proper accounts and records to present fairly the financial transactions for the financial year ending 30 June 2017 and the financial position as at 30 June 2017.

At the date of signing I am not aware of any circumstances which would render the particulars included in the financial statements misleading or inaccurate.

Lex McCulloch Reporting Officer 12 September 2017

https://www.slp.wa.gov.au/legislation/statutes.nsf/main_mrtitle_333_homepage.html


Statement of Comprehensive IncomeFor the year ended 30 June 2017

Note2017$’000

2016$’000

COST OF SERVICESExpenses

Employee benefits 4 85,057 83,769Supplies and services 6 24,543 24,216Depreciation and amortisation 7 4,100 4,271Finance costs 8 22 24Accommodation 9 8,902 10,683Grants and subsidies 10 18,391 16,621Revaluation decrements 16 117 -Impairment 28 - 123Other expenses 11 9,133 1,725

Total cost of services 150,264 141,432IncomeRevenue

User charges and fees 13 61,480 71,386Sales 13 114 190Commonwealth grants and contributions 14 418 362Other revenue 15 6,158 6,326

Total revenue 68,170 78,264Gains

Other gains 18 11 146Total gains 11 146Total income other than income from State Government 68,180 78,411NET COST OF SERVICES 82,083 63,022Income from State Government 19

Service appropriation 58,028 42,690Services received free of charge 871 1,116Royalties for Regions Fund 9,867 10,138

Total income from State Government 68,766 53,944SURPLUS/(DEFICIT) FOR THE PERIOD (13,317) (9,078)OTHER COMPREHENSIVE INCOME 34Items not reclassified subsequently to profit or loss

Changes in asset revaluation surplus (2,064) 20Total other comprehensive income (2,064) 20TOTAL COMPREHENSIVE INCOME FOR THE PERIOD (15,381) (9,058)

See also the ‘Schedule of Income and Expenses by Service’.

The Statement of Comprehensive Income should be read in conjunction with the accompanying notes.


Statement of Financial PositionAs at 30 June 2017

Note2017$’000

2016$’000

ASSETSCurrent Assets

Cash and cash equivalents 35 7,663 16,506Restricted cash and cash equivalents 20 189,827 190,822Receivables 21 5,032 10,762Amounts receivable for services 22 2,974 53Other current assets 23 1,655 741

Total Current Assets 207,151 218,884Non-Current Assets

Restricted cash and cash equivalents 20 285 -Receivables 21 9,657 10,024Amounts receivable for services 22 11,826 11,638Property, plant and equipment 24 41,455 44,644Intangible assets 27 10,319 9,538

Total Non-Current Assets 73,541 75,844TOTAL ASSETS 280,692 294,728

LIABILITIESCurrent Liabilities

Payables 29 4,888 4,488Unearned revenues 32 9,824 9,227Provisions 31 18,645 18,420Other current liabilities 33 367 341

Total Current Liabilities 33,724 32,476Non-Current Liabilities

Payables 29 500 589Unearned revenues 32 9,601 8,665Borrowings 30 771 771Provisions 31 3,641 3,675

Total Non-Current Liabilities 14,514 13,700TOTAL LIABILITIES 48,238 46,176NET ASSETS 232,455 248,552

EQUITY 34Contributed equity 77,639 78,356Reserves 8,972 11,036Accumulated surplus 145,843 159,161

TOTAL EQUITY 232,455 248,552

See also the ‘Schedule of Assets and Liabilities by Service’.

The Statement of Financial Position should be read in conjunction with the accompanying notes.


Statement of Changes in EquityFor the year ended 30 June 2017

Note

Contributed equity $’000

Reserves $’000

Accumulated surplus

$’000

Total equity $’000

Balance at 1 July 2015 34 78,953 11,016 168,238 258,207Surplus/(Deficit) - - (9,078) (9,078)Other Comprehensive income - 20 - 20

Total comprehensive income for the period - 20 (9,078) (9,058)

Transactions with owners in their capacity as owners:

Distribution to owners (597) - - (597)Total (597) - - (597)

Balance at 30 June 2016 78,356 11,036 159,161 248,552

Balance at 1 July 2016 78,356 11,036 159,161 248,552Surplus/(Deficit) - - (13,317) (13,317)Other Comprehensive income - (2,064) - (2,064)

Total comprehensive income for the period - (2,064) (13,317) (15,381)

Transactions with owners in their capacity as owners:

Distribution to owners (717) - - (717)Total (717) - - (717)

Balance at 30 June 2017 77,639 8,972 145,843 232,455

The Statement of Changes in Equity should be read in conjunction with the accompanying notes.


Statement of Cash FlowsFor the year ended 30 June 2017

Note2017$’000

2016$’000

CASH FLOWS FROM STATE GOVERNMENTService appropriation 54,806 38,960Holding account drawdowns 113 2,800Royalties for Regions Fund 9,867 10,138Distribution to owners (717) (597)

Net cash provided by State Government 64,070 51,301

Utilised as follows:CASH FLOWS FROM OPERATING ACTIVITIESPayments

Employee benefits (84,589) (86,880)Supplies and services (26,199) (24,008)Finance costs (22) (24)Accommodation (8,903) (10,035)Grants and subsidies (17,995) (17,706)GST payments on purchases (3,850) (5,003)Other payments (1,733) (1,719)

ReceiptsUser charges and fees 61,568 67,793Sale of goods and services 1,916 190Commonwealth grants and contributions 318 362GST receipts on sales 354 499GST receipts from taxation authority 4,451 4,726Other receipts 6,348 6,866

Net cash provided by/(used in) operating activities 35 (68,336) (64,940)

CASH FLOWS FROM INVESTING ACTIVITIESPayments

Purchase of non-current assets (5,288) (6,001)

Net cash provided by/(used in) investing activities (5,288) (6,001)

Net increase/(decrease) in cash and cash equivalents (9,554) (19,640)Cash and cash equivalents at the beginning of the period 207,328 226,968CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 35 197,774 207,328

The Statement of Cash Flows should be read in conjunction with the accompanying notes.

Schedule of Income and Expenses by ServiceFor the year ended 30 June 2017

Consumer Protection

Industry and Technology Energy Safety Labour Relations WorkSafe Building

Commission Total

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000


Employee benefits 31,182 31,259 3,165 2,549 9,731 9,747 5,865 5,814 18,429 18,311 16,685 16,090 85,057 83,769Supplies and services 5,931 5,917 3,002 3,679 3,101 2,723 862 740 4,762 4,695 6,883 6,463 24,543 24,216Depreciation and amortisation 1,941 2,133 84 233 526 452 365 258 763 776 420 419 4,100 4,271Finance costs - - 22 24 - - - - - - - - 22 24Accommodation 4,159 5,452 66 385 927 945 1,202 752 1,132 1,568 1,416 1,580 8,902 10,683Grants and subsidies 5,969 5,431 11,572 10,341 - - - - 170 170 680 680 18,391 16,621Revaluation decrement - - - - - - 117 - - - - - 117 -Impairment - 74 - 2 - 6 - 4 - 24 - 12 - 123Other expenses 7,302 1,112 148 312 269 24 206 76 617 46 589 156 9,133 1,725

Total cost of services 56,486 51,378 18,059 17,525 14,555 13,897 8,618 7,644 25,873 25,590 26,674 25,399 150,264 141,432Income

User charges and fees 14,421 21,760 1,792 1,859 14,690 13,967 - - 5,926 6,285 24,650 27,515 61,480 71,386Sales - 1 - - 10 12 - - 104 177 - - 114 190Commonwealth grants and contributions 280 237 - 1 67 58 1 1 42 40 27 25 418 362

Other revenue 3,868 4,476 691 835 167 170 109 105 388 419 936 322 6,158 6,326Other gains 4 - - 146 1 - 1 - 2 - 2 - 10 146

Total income other than income from State Government 18,573 26,474 2,484 2,841 14,935 14,206 111 106 6,462 6,921 25,616 27,861 68,180 78,411

NET COST OF SERVICES 37,912 24,904 15,576 14,683 (380) (310) 8,507 7,538 19,411 18,669 1,058 (2,463) 82,083 63,022INCOME FROM STATE GOVERNMENT

Service appropriation 33,639 21,164 2,612 1,407 - - 6,596 5,734 15,182 14,385 - - 58,028 42,690Services received free of charge 413 659 4 61 20 70 162 39 136 192 136 96 871 1,116Royalties for Regions Fund 16 15 9,744 10,000 2 2 98 114 5 3 4 3 9,867 10,138

Total income from State Government 34,067 21,838 12,360 11,468 21 71 6,856 5,887 15,322 14,580 140 99 68,766 53,944SURPLUS/(DEFICIT) FOR THE PERIOD (3,846) (3,066) (3,216) (3,216) 401 381 (1,651) (1,651) (4,089) (4,089) (918) 2,562 (13,317) (9,078)

The Schedule of Income and Expenses by Service should be read in conjunction with the accompanying notes.

Income and expenses have been allocated directly to the appropriate service where known, with the balance being allocated on a notional proportionate basis.


Schedule of Assets and Liabilities by ServiceAs at 30 June 2017

Consumer Protection

Industry and Technology Energy Safety Labour Relations WorkSafe Building

Commission Total

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

AssetsCurrent assets 166,659 174,731 3,405 5,410 12,789 12,250 1,293 1,404 4,659 5,349 18,348 19,739 207,151 218,884Non-current assets 9,078 9,825 49,343 51,901 4,264 3,556 1,583 1,799 4,574 4,774 4,699 3,989 73,541 75,844

Total assets 175,737 184,557 52,748 57,311 17,052 15,806 2,875 3,204 9,233 10,123 23,047 23,728 280,692 294,728

LiabilitiesCurrent liabilities 11,264 10,995 1,139 992 4,669 4,674 2,003 1,681 5,431 5,406 9,218 8,730 33,724 32,476Non-current liabilities 4,606 4,580 897 870 4,056 3,546 244 347 777 770 3,933 3,586 14,514 13,700

Total liabilities 15,870 15,575 2,036 1,862 8,725 8,220 2,247 2,028 6,208 6,176 13,151 12,316 48,238 46,176

NET ASSETS 159,867 168,982 50,712 55,449 8,327 7,585 628 1,176 3,025 3,947 9,896 11,412 232,455 248,552

The Schedule of Assets and Liabilities by Service should be read in conjunction with the accompanying notes.

Assets and liabilities have been allocated directly to the appropriate service where known, with the balance being allocated on a notional proportionate basis.



Summary of Consolidated Account Appropriations and Income EstimatesFor the year ended 30 June 2017

2017 Estimate

$’000

2017 Actual$’000

Variance$’000

2017 Actual$’000

2016 Actual$’000

Variance$’000

DELIVERY OF SERVICESItem 80 Net amount appropriated to deliver services 56,860 56,783 (77) 56,783 41,476 15,307

Amount Authorised by Other Statutes - Salaries and Allowances Act 1975 1,245 1,245 - 1,245 1,214 31

Total appropriations provided to deliver services 58,105 58,028 (77) 58,028 42,690 15,338

ADMINISTERED TRANSACTIONSItem 81 Amount Provided for Administered Grants, Subsidies and Other Transfer Payments

7,644 - (7,644) - - -

Total administered transactions 7,644 - (7,644) - - -GRAND TOTAL 65,749 58,028 (7,721) 58,028 42,690 15,338

Details of Expenses by Service (b)Consumer Protection 52,852 56,486 3,634 56,486 51,378 5,107Industry and Technology 19,707 18,059 (1,648) 18,059 17,525 535Energy Safety 15,111 14,555 (556) 14,555 13,897 659Labour Relations 7,880 8,618 738 8,618 7,644 974WorkSafe 26,674 25,873 (801) 25,873 25,590 282Building Commission 30,602 26,674 (3,928) 26,674 25,399 1,275

Total Cost of Services 152,826 150,264 (2,562) 150,264 141,432 8,831Less Total Income (81,119) (68,180) 12,939 (68,180) (78,411) 10,231Net Cost of Services 71,707 82,083 10,377 82,083 63,022 19,062Adjustments (a) (13,602) (24,055) (10,453) (24,055) (20,332) (3,724)

Total appropriations provided to deliver services 58,105 58,028 (77) 58,028 42,690 15,339

Capital ExpenditurePurchase of non-current assets 9,199 5,288 (3,911) 5,288 6,001 (713)

Capital appropriation 9,199 5,288 (3,911) 5,288 6,001 (713)

Details of Income EstimatesIncome disclosed as Administered Income 38,495 40,249 1,754 40,249 48,093 (7,844)

Total income estimates 38,495 40,249 1,754 40,249 48,093 (7,844)

(a) Adjustments comprise movements in cash balances and other accrual items such as receivables, payables and superannuation.

(b) Details of Expenses by Service for 2017 Estimate are as reported in the 2016–17 Budget Papers.

Note 40 ‘Explanatory statement’ and Note 48 ‘Explanatory statement for administered items’ provides details of any significant variations between estimate and actual results for 2017 and between the actual results for 2016 and 2017.



Notes to the Financial StatementsFor the year ended 30 June 2017

1. Australian Accounting Standards

GeneralThe department’s financial statements for the year ended 30 June 2017 have been prepared in accordance with Australian Accounting Standards. The term ‘Australian Accounting Standards’ includes Standards and Interpretations issued by the Australian Accounting Standard Board (AASB).

The department has adopted any applicable new and revised Australian Accounting Standards from their operative dates.

Early adoption of standardsThe department cannot early adopt an Australian Accounting Standard unless specifically permitted by Treasurer’s instruction (TI) 1101 ‘Application of Australian Accounting Standards and Other Pronouncements’. There has been no early adoption of Australian Accounting Standards that have been issued or amended (but not operative) by the department for the annual reporting period ended 30 June 2017.

2. Summary of significant accounting policies

(a) General StatementThe department is a not-for-profit reporting entity that prepares general purpose financial statements in accordance with Australian Accounting Standards, the Framework, Statements of Accounting Concepts and other authoritative pronouncements of the AASB as applied by the Treasurer’s instructions. Several of these are modified by the Treasurer’s instruction to vary application, disclosure, format and wording.

The Financial Management Act 2006 and the Treasurer’s Instructions impose legislative provisions that govern the preparation of financial statements and take precedence over Australian Accounting Standards, the Framework, Statements of Accounting Concepts and other authoritative pronouncements of the AASB.

Where modification is required and has had a material or significant financial effect upon the reported results, details of that modification and the resulting financial effect are disclosed in the notes to the financial statements.

(b) Basis of PreparationThe financial statements have been prepared on the accrual basis of accounting using the historical cost convention, except for land and buildings which have been measured at fair value.

The accounting policies adopted in the preparation of the financial statements have been consistently applied throughout all periods presented unless otherwise stated.

The financial statements are presented in Australian dollars and all values are rounded to the nearest thousand dollars ($’000).

Note 2(x) ‘Judgements made by management in applying accounting policies’ discloses judgements that have been made in the process of applying the department’s accounting policies resulting in the most significant effect on amounts recognised in the financial statements.

Note 2(y) ‘Key sources of estimation uncertainty’ discloses key assumptions made concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Machinery of Government changesUnder the Public Sector Management Act 1994 section 35(1)(b), the Governor has amalgamated the departments designated Department of Commerce and Department of Mines and Petroleum; and resulted in the Department of Mines, Industry Regulation and Safety, with effect on and after 1 July 2017.

The financial statements have been prepared on the going concern basis as the net assets will be transferred to the


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Department of Mines, Industry Regulation and Safety, that will continue to provide services to the public.

(c) Reporting EntityThe reporting entity comprises the Department of Commerce.

MissionThe department’s mission is to create a contemporary, diversified economy that provides for the growth, safety and protection of the community.

ServicesThe department provides the following services:

Service 1: Consumer ProtectionThe provision of consumer protection advice, information, education and business regulation services to the Western Australian community.

Service 2: Industry and TechnologyContributes to the State’s economy by promoting industry and technology. Services include supporting industry development through research and infrastructure, promoting Western Australian industry opportunities and capabilities, and providing policy development advice.

Service 3: Energy SafetyThe provision of regulatory services to the Western Australian community through licensing and compliance activities in the area of energy safety.

Service 4: Labour RelationsTo assist private and public sector workplaces to be economically sustainable and fair by providing our stakeholders and clients with expert labour relations advice, education and regulation.

Service 5: WorkSafeThe provision of advice, information, education, licensing and enforcement services to the Western Australian community in the area of occupational safety and health.

Service 6: Building CommissionThe provision of reform, regulatory and dispute resolution services that enable the building and plumbing industries to efficiently deliver buildings that are safe, sustainable and respond to community needs.

The department administers assets, liabilities, income and expenses on behalf of Government which are not controlled by, nor integral, to the function of the department. These administered balances and transactions are not recognised in the principal financial statements of the department but schedules are prepared using the same basis as the financial statements and are presented at Note 47 ‘Disclosure of Administered Income and Expenses by Service’ and Note 49 ‘Administered Assets and Liabilities’.

(d) Contributed EquityAASB Interpretation 1038 ‘Contributions by Owners Made to Wholly-Owned Public Sector Entities’ requires transfers in the nature of equity contributions, other than as a result of a restructure of administrative arrangements, to be designated by the Government (the owner) as contributions by owners (at the time of, or prior to transfer) before such transfers can be recognised as equity contributions. Capital appropriations have been designated as contributions by owners by TI 955 ‘Contributions by Owners Made to Wholly-Owned Public Sector Entities’ and have been credited directly to Contributed Equity.

The transfer of net assets to/from other agencies, other than as a result of a restructure of administrative arrangements, are designated as contributions by owners where the transfers are non-discretionary and non-reciprocal. See Note 34 ‘Equity’.

(e) IncomeRevenue RecognitionRevenue is recognised and measured at the fair value of consideration received or receivable. Revenue is recognised for the major business activities as follows:



Sale of goods

Revenue is recognised from the sale of goods and disposal of other assets when the significant risks and rewards of ownership transfer to the purchaser and can be measured reliably.

Provision of services

Revenue is recognised by reference to the stage of completion of the transaction.

Interest

Revenue is recognised as the interest accrues.

Premium revenue

Direct premium comprises amounts charged to the policyholders but excludes taxes collected on behalf of third parties. The earned portion of premiums received is recognised as premium revenue in the Statement of Comprehensive Income (Administered). Premium revenue is earned from the date of attachment of risk and over the term of the policies written, based on the assessment of the likely pattern in which risk will emerge. A daily pro-rata basis is used to recognise revenue. The portion not earned as determined by the above method is classified on the Statement of Financial Position (Administered) as unearned premium. See Note 46 ‘Disclosure of administered expenses and income’ and Note 49 ‘Disclosure of administered assets and liabilities’ for further information.

Unearned premium liabilities

The adequacy of the unearned premium liability is assessed by considering current estimates of all expected future cash flows relating to future claims covered by current insurance contracts. If the present value of the expected future cash flows relating to future claims, plus the additional risk margin to reflect the inherent uncertainty in the central estimate exceeds the unearned premium liability, then the unearned premium liability is deemed deficient. Any deficiency is recognised immediately in

the Statement of Comprehensive Income (Administered) as an expense, both gross and net of reinsurance. Any excess is recorded on the Statement of Financial Position as an unexpired risk liability. See Note 46 ‘Disclosure of administered expenses and income’ and income and Note 49 ‘Disclosure of administered assets and liabilities’ for further information.

Service appropriations

Service appropriations are recognised as revenues at fair value in the period in which the department gains control of the appropriated funds. The department gains control of appropriated funds at the time those funds are deposited to the bank account or credited to the ‘Amounts receivable for services’ (holding account) held at Treasury. See Note 19 ‘Income from State Government’ for further information.

Net appropriation determination

The Treasurer may make a determination providing for prescribed receipts to be retained for services under the control of the department. In accordance with the determination specified in the 2016–2017 Budget Statements, the department retained $68.180 million in 2017 ($78.411 million in 2016) from the following:

• proceeds from fees and charges;

• sale of goods;

• Commonwealth specific purpose grants and contributions; and

• other departmental revenue.

Grants, donations, gifts and other non-reciprocal contributions

Revenue is recognised at fair value when the department obtains control over the assets comprising the contributions, usually when cash is received.

Other non-reciprocal contributions that are not contributions by owners are recognised at their fair value. Contributions of services are only recognised when a fair value can be



reliably determined and the services would be purchased if not donated.

Royalties for Regions funds are recognised as revenue at fair value in the period in which the department obtains control over the funds. The department obtains control of the funds at the time the funds are deposited into the department’s bank account.

GainsRealised or unrealised gains are usually recognised on a net basis. These include gains arising on the disposal of non current assets and some revaluations of non-current assets.

(f) Borrowing CostsAll borrowing costs are expensed when incurred.

All loans payable are initially recognised at cost being the fair value of the net proceeds received. Subsequent measurement is at amortised cost using the effective interest rate method.

(g) Property, Plant and EquipmentCapitalisation/expensing of assetsItems of land are capitalised irrespective of value. All other property, plant and equipment are recognised as assets when their cost or fair value is $5,000 or more. The cost of utilising assets is expensed (depreciated) over their useful lives. Items of property, plant and equipment costing less than $5,000 are immediately expensed directly to the Statement of Comprehensive Income (other than where they form part of a group of similar items which are significant in total).

Initial recognition and measurementAll items of property, plant and equipment are initially recognised at cost.

For items of property, plant and equipment acquired at no cost or for nominal cost, the cost is the fair value at the date of acquisition.

Subsequent measurementSubsequent to initial recognition as an asset, the department uses the revaluation model for the measurement of land and buildings and the historical cost model for all property, plant and equipment. Land and buildings are carried at fair value less accumulated depreciation on buildings and accumulated impairment losses. All other items of property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses. Where market-based evidence is available, the fair value of land and buildings is determined on the basis of current market buying values determined by reference to recent market transactions. When buildings are revalued by reference to recent market transactions, the accumulated depreciation is eliminated against the gross carrying amount of the asset and the net amount restated to the revalued amount.

When market-based evidence is not available, the fair value of land and buildings is determined on the basis of existing use. This normally applies where buildings are specialised or where land use is restricted. Fair value for existing use building assets is determined by reference to the cost of replacing the remaining future economic benefits embodied in the asset, i.e. the depreciated replacement cost. Where the fair value of buildings is dependent on using the depreciated replacement cost basis, the gross carrying amount and the accumulated depreciation are restated proportionally.

Independent valuations of land and buildings are provided annually by the Western Australian Land Information Authority (Valuation Services) and recognised annually to ensure that the carrying amount does not differ materially from the asset’s fair value at the end of the reporting period.



The most significant assumptions in estimating fair value are made in assessing whether to apply the existing use basis to assets and in determining estimated useful life. Professional judgement by the valuer is required where the evidence does not provide a clear distinction between market type assets and existing use assets.

Refer to Note 24 ‘Property, plant and equipment’ for further information on revaluations.

DerecognitionUpon disposal or derecognition of an item of property, plant and equipment, any revaluation surplus relating to that asset is retained in the asset revaluation surplus.

Asset revaluation surplusThe asset revaluation surplus is used to record increments and decrements on the revaluation of non-current assets as described in Note 24 ‘Property, plant and equipment’.

However, a net revaluation movement in respect of a class of assets in property, plant and equipment is recognised in the “Result for the period” to the extent that it reverses a net revaluation decrement of the same class of assets previously expensed in the “Result for the period”. Also, a net revaluation decrement, in respect of a class of assets, is expensed in the “Result for the period” to the extent that there is no credit balance in the asset revaluation surplus for that same class of assets.

DepreciationAll non-current assets having a limited useful life are systematically depreciated over their estimated useful lives in a manner that reflects the consumption of their future economic benefits.

Land is not depreciated. Depreciation on other assets is calculated using the straight-line method, using rates that are reviewed annually. Estimated useful lives for each class of depreciable asset are:

Class of Asset Years

Buildings 40Property infrastructure 5 to 15Computer hardware 3 to 5Communication 5Computer software(a) 3 to 5Furniture and fittings 10Office equipment 3 to 5Plant and machinery 10

(a) Software that is integral to the operation of related hardware

(h) Intangible AssetsCapitalisation/expensing of assetsAcquisitions of intangible assets costing $5,000 or more and internally developed intangible assets costing $100,000 or more are capitalised. The cost of utilising the assets is expensed (amortised) over their useful life. Costs incurred below these thresholds are immediately expensed directly to the Statement of Comprehensive Income.

All acquired and internally developed intangible assets are initially recognised at cost. For assets acquired at no cost or for nominal cost, the cost is their fair value at the date of acquisition.

The cost model is applied for subsequent measurement requiring the asset to be carried at cost less any accumulated amortisation and accumulated impairment losses.

Amortisation of intangible assets with finite useful lives is calculated for the period of the expected benefit (estimated useful life which is reviewed annually) on the straight-line basis. All intangible assets controlled by the department have a finite useful life and zero residual value.

Intangible assets held by the department are amortised on a straight-line basis using rates that are reviewed annually.



The expected useful lives for intangible software assets are:

Internally developed systems 3–12 yearsAll other intangible software assets 3 years

Computer softwareSoftware that is an integral part of the related hardware is treated as property, plant and equipment. Software that is not an integral part of the related hardware is treated as an intangible asset. Software costing less than $5,000 is expensed in the year of acquisition.

Systems developmentFor system developments, research costs are expensed as incurred. Development costs incurred on an individual project are carried forward when their future recoverability can reasonably be regarded as assured and where the total capitalised costs are likely to exceed $100,000. Other development expenditures are expensed as incurred.

Web site costsWeb site costs are expensed when they are incurred unless the cost exceeds $100,000. In this instance they are capitalised and amortised over their useful life.

(i) Impairment of AssetsProperty, plant and equipment and intangible assets are tested, when appropriate, for any indication of impairment at the end of each reporting period. Where there is an indication of impairment, the recoverable amount is estimated. Where the recoverable amount is less than the carrying amount, the asset is considered impaired and is written down to the recoverable amount and an impairment loss is recognised. Where an asset measured at cost is written down to recoverable amount, an impairment loss is recognised in profit and loss. Where a previously revalued asset is written down to recoverable amount, the loss is recognised as a revaluation decrement

in other comprehensive income. As the department is a not for profit entity, unless an asset has been identified as a surplus asset, the recoverable amount is the higher of an asset’s fair value less costs to sell and depreciated replacement cost.

The risk of impairment is generally limited to circumstances where an asset’s depreciation is materially understated, where the replacement cost is falling or where there is a significant change in useful life. Each relevant class of assets is reviewed annually to verify that the accumulated depreciation/amortisation reflects the level of consumption or expiration of asset’s future economic benefits and to evaluate any impairment risk from falling replacement costs.

Intangible assets not yet available for use are tested for impairment at the end of each reporting period irrespective of whether there is any indication of impairment.

The recoverable amount of assets identified as surplus assets is the higher of fair value less costs to sell and the present value of future cash flows expected to be derived from the asset. Surplus assets carried at fair value have no risk of material impairment where fair value is determined by reference to market-based evidence. Where fair value is determined by reference to depreciated replacement cost, surplus assets are at risk of impairment and the recoverable amount is measured. Surplus assets at cost are tested for indications of impairment at the end of the reporting period.

See Note 28 ‘Impairment of assets’ for the outcome of impairment reviews and testing.

See Note 2(p) ‘Receivables’ and Note 21 ‘Receivables’ for impairment of receivables.

(j) Non Current Assets (or Disposal Groups) Classified as Held for SaleThe department does not have any non-current assets classified as held for sale during the year.



(k) LeasesThe department does not have any finance leases.

The department holds operating leases for head office and a number of branch office accommodations. Lease payments are expensed on a straight-line basis over the lease term as this represents the pattern of benefits derived from the leased properties.

(l) Financial InstrumentsIn addition to cash the department has two categories of financial instruments:

• Loans and receivables; and

• financial liabilities measured at amortised cost.

Financial instruments have been disaggregated into the following classes:

Financial Assets

• Cash and cash equivalents

• Restricted cash and cash equivalents

• Receivables

• Amounts receivable for services

Financial Liabilities

• Payables

• W.A. LandCorp Borrowings

Initial recognition and measurement of financial instruments is at fair value which normally equates to the transaction cost or the face value. Subsequent measurement is at amortised cost using the effective interest method.

The fair value of short-term receivables and payables is the transaction cost or the face value because there is no interest rate applicable and subsequent measurement is not required as the effect of discounting is not material.

(m) Cash and Cash EquivalentsFor the purpose of the Statement of Cash Flows, cash and cash equivalent

(and restricted cash and cash equivalent) assets comprise cash on hand and short-term deposits with original maturities of three months or less that are readily convertible to a known amount of cash and which are subject to insignificant risk of changes in value.

(n) Accrued SalariesAccrued salaries (refer Note 29 ‘Payables’) represent the amount due to staff but unpaid at the end of the financial year, as the pay date for the last pay period for that financial year does not coincide with the end of the financial year. Accrued salaries are settled within a fortnight of the financial year end. The department considers the carrying amount of accrued salaries to be equivalent to the net fair value.

The accrued salaries suspense account (see Note 20 ‘Restricted cash and cash equivalents’) consists of amounts paid annually into a suspense account over a period of 10 financial years to largely meet the additional cash outflow in each eleventh year when 27 pay days occur instead of the normal 26. No interest is received on this account.

(o) Amounts Receivable for Services (Holding Account)The department receives funding on an accrual basis that recognises the full annual cash and non cash cost of services. The appropriations are paid partly in cash and partly as an asset (Holding Account receivable) that is accessible on the emergence of the cash funding requirement to cover items such as leave entitlements and asset replacement.

See also Note 19 ‘Income from State Government’ and Note 22 ‘Amounts receivable for services (Holding Account)’.

(p) ReceivablesReceivables are recognised and carried at original invoice amount less an allowance for uncollectible amounts (i.e. impairment).



The collectability of receivables is reviewed on an ongoing basis and any receivables identified as uncollectible are written off against the allowance account. The allowance for uncollectible amounts (doubtful debts) is raised when there is objective evidence that the department will not be able to collect the debts. The carrying amount is equivalent to fair value, as it is due for settlement within 30 days. See Note 2(l) ‘Financial Instruments’ and Note 21 ‘Receivables’.

(q) PayablesPayables are recognised at the amounts payable when the department becomes obliged to make future payments as a result of a purchase of assets or services. The carrying amount is equivalent to fair value, as they are generally settled within 30 days. See Note 2(l) ‘Financial Instruments’ and Note 29 ‘Payables’.

(r) Claims and Outstanding Claims LiabilityClaims expense represents payment for claims and the movement in outstanding claims liabilities. The liability covers claims reported but not paid (“RBNP”), claims incurred but not reported (“IBNR”), claims incurred but not enough reported (“IBNER”) and the anticipated direct and indirect costs of settling those claims. The liability for outstanding claims is determined by having regard to the advice of the PricewaterhouseCoopers Actuarial report. The liability is measured as the central estimate of the present value of the expected future payments against claims incurred at the reporting date under general insurance contracts issued by the division. A risk margin is added to the outstanding claims provision, net of reinsurance and other recoveries, to allow for the net liability being adequate at a sufficiency level deemed appropriate. The expected future payments are discounted to present value at balance date using a risk-free rate implied by the yield curve on government bonds at

balance date. See Note 46 ‘Disclosure of administered expenses and income’ and Note 49 ‘Disclosure of administered assets and liabilities’ for further information.

(s) ProvisionsProvisions are liabilities of uncertain timing or amount and are recognised where there is a present legal or constructive obligation as a result of a past event and when the outflow of resources embodying economic benefits is probable and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at the end of each reporting period. See Note 31 ‘Provisions’.

(i) Provisions - Employee BenefitsAnnual Leave and Long Service LeaveProvisions - employee benefits

All annual leave and long service leave provisions are in respect of employees’ services up to the end of the reporting period.

Annual leaveAnnual leave is not expected to be settled wholly within 12 months after the end of the reporting period and is therefore considered to be ‘other long-term employee benefits’. The annual leave liability is recognised and measured at the present value of amounts expected to be paid when the liabilities are settled using the remuneration rate expected to apply at the time of settlement.

When assessing expected future payments consideration is given to expected future wage and salary levels including non-salary components such as employer superannuation contributions, as well as the experience of employee departures and periods of service. The expected future payments are discounted using market yields at the end of the reporting period on national government bonds with terms to maturity that match, as closely as possible, the estimated future cash outflows.

The provision for annual leave is classified as a current liability as the department does not have an unconditional right to the



defer settlement of the liability for at least 12 months after the reporting period.

Long service leaveLong service leave is not expected to be settled wholly within 12 months after the end of the reporting period and is therefore recognised and measured at the present value of amounts expected to be paid when the liabilities are settled using the remuneration rate expected to apply at the time of settlement.

When assessing expected future payments consideration is given to expected future wage and salary levels including non-salary components such as employer superannuation contributions, as well as the experience of employee departures and periods of service. The expected future payments are discounted using market yields at the end of the reporting period on national government bonds with terms to maturity that match, as closely as possible, the estimated future cash outflows.

Unconditional long service leave provisions are classified as current liabilities as the department does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Pre-conditional and conditional long service leave provisions are classified as non-current liabilities because the department has an unconditional right to defer the settlement of the liability until the employee has completed the requisite years of service.

Deferred leaveThe provision for deferred leave relates to Public Service employees who have entered into an agreement to self-fund an additional 12 months leave in the fifth year of the agreement. The provision recognises the value of salary set aside for employees to be used in the fifth year. This liability is measured on the same basis as annual leave. Deferred leave is reported as a current provision as employees can leave the scheme at their discretion at any time.

Purchased leaveThe provision for purchased leave relates to Public Service employees who have entered into an agreement to self-fund up to an additional 10 weeks leave per calendar year. The provision recognises the value of salary set aside for employees and is measured at the undiscounted amounts expected to be paid when the liabilities are settled.

SuperannuationThe Government Employees Superannuation Board (GESB) administers public sector superannuation arrangements in Western Australia in accordance with legislative requirements. Eligibility criteria for membership in particular schemes for public section employees vary according to commencement and implementation dates.

Eligible employees contribute to the Pension Scheme, a defined benefit pension scheme closed to new members since 1987, or the Gold State Superannuation Scheme (GSS), a defined benefit lump sum scheme closed to new members since 1995.

The GSS is a defined benefit scheme for the purposes of employees and whole-of-government reporting. However, it is a defined contribution plan for agency purposes, because the concurrent contributions (defined contributions) made by the department to GESB extinguishes the agency’s obligations to the related superannuation liability.

The department has no liabilities under the Pension or the GSS. The liabilities for the unfunded Pension Scheme and the unfunded GSS transfer benefits attributable to members who transferred from the Pension Scheme are assumed by the Treasurer. All other GSS obligations are funded by concurrent contributions made by the department to the GESB.

Employees commencing employment prior to 16 April 2007 who were not members of either the Pension or the GSS became non-



contributory members of the West State Superannuation Scheme (WSS). Employees commencing employment on or after 16 April 2007 became members of the GESB Super Scheme (GESBS). From 30 March 2012, existing members of the WSS or GESBS and new employees became able to choose their preferred superannuation fund. The department makes concurrent contributions to GESB or other funds on behalf of employees in compliance with the Commonwealth Government’s Superannuation Guarantee (Administration) Act 1992. Contributions to these accumulation schemes extinguish the department’s liability for superannuation charges in respect of employees who are not members of the Pension Scheme or GSS.

The GESB makes all benefit payments in respect of the Pension and GSS, and is recouped from the Treasurer for the employer’s share.

See also Note 2(t) ‘Superannuation Expense’.

(ii) Provisions - OtherEmployment on-costsEmployment on-costs, including workers’ compensation insurance, are not employee benefits and are recognised separately as liabilities and expenses when the employment to which they relate has occurred. Employment on-costs are included as part of ‘Other expenses’ and are not included as part of the department’s ‘Employee benefits expense’. The related liability is included in Employment on-costs provision (see Note 11 ‘Other expenses’ and Note 31 ‘Provisions’).

(t) Superannuation ExpenseThe superannuation expense in the Statement of Comprehensive Income comprises of employer contributions paid to the GSS (concurrent contributions), the WSS, the GESBS or other superannuation funds. The employer contribution paid to the GESB in respect of the GSS is paid back into the Consolidated Account by the GESB.

(u) Assets and Services Received Free of Charge or for Nominal CostAssets or services received free of charge or for nominal cost that the department would otherwise purchase if not donated, are recognised as income at the fair value of the assets or services where they can be reliably measured. A corresponding expense is recognised for services received. Receipts of assets are recognised in the Statement of Financial Position.

Assets or services received from other State Government agencies are separately disclosed under Income from State Government in the Statement of Comprehensive Income.

(v) Comparative FiguresComparative figures are, where appropriate, reclassified to be comparable with the figures presented in the current financial year.

(w) Loans Converted to GrantsThe department’s range of assistance to industry includes loans, which are incrementally convertible to grants at prescribed intervals upon the recipients meeting performance milestones. The loans are recognised as loans receivable and a waiver of the loan is recognised for the conversion of the loans to grants at the time of conversion.

(x) Judgements Made by Management in Applying Accounting PoliciesThe preparation of financial statements requires management to make judgements about the application of accounting policies that have a significant effect on the amounts recognised in the financial statements. The department evaluates these judgements regularly.

Operating lease commitmentsThe department holds operating leases for head office and a number of branch office accommodations. Some of these leases relate to buildings of a temporary



nature and it has been determined that the lessor retains substantially all the risks and rewards incidental to ownership. Hence, these leases have been classified as operating leases.

(y) Key Sources of Estimation UncertaintyKey estimates and assumptions concerning the future are based on historical experience and various other factors that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.

Long service leaveSeveral estimations and assumptions used in calculating the department’s long service leave provision include expected future salary rates, discount rates, employee retention rates and expected future payments. Changes in these estimations and assumptions may impact on the carrying amount of the long service leave provision.

(z) Critical Accounting Judgements and EstimatesThe department makes estimates and assumptions in respect of certain key assets and liabilities. Estimates and judgements are regularly evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The key areas in which critical estimates and judgements are applied are described below.

The ultimate liability arising from claims made under insurance contracts.Provision is estimated at year end for the estimated cost of claims incurred but not settled at balance date, including the cost of claims incurred but not reported. The estimated cost of claims includes an estimate of the direct and indirect expenses to be incurred in settling claims. Whilst all reasonable steps are taken to ensure that adequate information is obtained on

outstanding claims expense, given the uncertainty in establishing claims provisions, it is likely that the final outcome will prove to be different from the original liability established. The estimation of unreported claims is generally subject to a greater degree of uncertainty than the estimation of the cost of settling claims already notified, where more information about the claim event is generally available. Unreported claims may not be apparent to the insurer until many years after the events giving rise to the claims. The liability component of the home business will typically display greater variation between initial case estimates and final outcomes because there is a greater degree of difficulty in estimating reserves for reported and unreported claims. The estimated cost of outstanding claims, is based upon an independent actuarial valuation which uses a variety of estimation techniques, generally based upon statistical analyses of historical experience, which assumes that the development pattern of current claims will be consistent with past claims experience. Allowance is made for changes or uncertainties which may create distortions in the underlying statistics or which might cause the cost of outstanding claims to increase or decrease when compared with the cost of previously settled claims including:

• changes in company processes which might accelerate or slow down the development and/or recording of paid or incurred claims, compared with the statistics from previous periods;

• changes in the legal environment;

• the effects of inflation;

• changes in the mix of business;

• the impact of large losses; and

• movements in industry benchmarks.

See Note 49 ‘Disclosure of administered assets and liabilities’ for further information.



3. Disclosure of changes in accounting policy and estimates

Initial application of an Australian Accounting StandardThe department has applied the following Australian Accounting Standards effective for annual reporting periods beginning on or after 1 July 2016 that impacted on the department.

AASB 1057 Application of Australian Accounting Standards

This Standard lists the application paragraphs for each other Standard (and Interpretation), grouped where they are the same. There is no financial impact.

AASB 2014-3 Amendments to Australian Accounting Standards – Accounting for Acquisitions of Interests in Joint Operations [AASB 1 and 11]

The department establishes Joint Operations in pursuit of its objectives and does not routinely acquire interests in Joint Operations. Therefore, there is no financial impact on application of the Standard.

AASB 2014-4 Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation [AASB 116 and 138]

The adoption of this Standard has no financial impact for the department as depreciation and amortisation is not determined by reference to revenue generation, but by reference to consumption of future economic benefits.

AASB 2014-9 Amendments to Australian Accounting Standards – Equity Method in Separate Financial Statements [AASB 1, 127 and 128]

This Standard amends AASB 127, and consequentially amends AASB 1 and AASB 128, to allow entities to use the equity method of accounting for investments in subsidiaries, joint ventures and associates in their separate financial statements. As the department has no joint ventures and associates, the application of the Standard has no financial impact.

AASB 2015-1 Amendments to Australian Accounting Standards Annual Improvements to Australian Accounting Standards 2012 2014 Cycle [AASB 1, 2, 3, 5, 7, 11, 110, 119, 121, 133, 134, 137 and 140]

These amendments arise from the issuance of International Financial Reporting Standard Annual Improvements to IFRSs 2012–2014 Cycle in September 2014, and editorial corrections. The department has determined that the application of the Standard has no financial impact.

AASB 2015-2 Amendments to Australian Accounting Standards Disclosure Initiative: Amendments to AASB 101 [AASB 7, 101, 134 and 1049]

This Standard amends AASB 101 to provide clarification regarding the disclosure requirements in AASB 101. Specifically, the Standard proposes narrow-focus amendments to address some of the concerns expressed about existing presentation and disclosure requirements and to ensure entities are able to use judgement when applying a Standard in determining what information to disclose in their financial statements. There is no financial impact.



AASB 2015-6 Amendments to Australian Accounting Standards Extending Related Party Disclosures to Not-for-Profit Public Sector Entities [AASB 10, 124 and 1049]

The amendments extend the scope of AASB 124 to include application by not-for-profit public sector entities. Implementation guidance is included to assist application of the Standard by not-for-profit public sector entities. There is no financial impact.

AASB 2015-10 Amendments to Australian Accounting Standards Effective Date of Amendments to AASB 10 and 128

This Standard defers the mandatory effective date (application date) of amendments to AASB 10 and AASB 128 that were originally made in AASB 2014-10 so that the amendments are required to be applied for annual reporting periods beginning on or after 1 January 2018 instead of 1 January 2016. There is no financial impact.

Future impact of Australian Accounting Standards not yet operativeThe department cannot early adopt an Australian Accounting Standard unless specifically permitted by TI 1101 Application of Australian Accounting Standards and Other Pronouncements or by an exemption from TI 1101. By virtue of a limited exemption, the department has early adopted AASB 2015-7 Amendments to Australian Accounting Standards Fair Value Disclosures of Not-for-Profit Public Sector Entities. Where applicable, the department plans to apply the following Australian Accounting Standards from their application date.

Standard

Operative for reporting

periods beginning on/after

AASB 9 Financial Instruments

This Standard supersedes AASB 139 Financial Instruments: Recognition and Measurement, introducing a number of changes to accounting treatments.

The mandatory application date of this Standard is currently 1 January 2018 after being amended by AASB 2012-6, AASB 2013-9 and AASB 2014-1 Amendments to Australian Accounting Standards. The department has not yet determined the application or the potential impact of the Standard.

1 Jan 2018

AASB 15 Revenue from Contracts with Customers

This Standard establishes the principles that the department shall apply to report useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from a contract with a customer.

The department’s income is principally derived from appropriations which will be measured under AASB 1058 Income of Not-for-Profit Entities and will be unaffected by this change. However, the department has not yet determined the potential impact of the Standard on ‘User charges and fees’ and ‘Sales’ revenues. In broad terms, it is anticipated that the terms and conditions attached to these revenues will defer revenue recognition until the department has discharged its performance obligations.

1 Jan 2019



Standard



AASB 16 Leases

This Standard introduces a single lessee accounting model and requires a lessee to recognise assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset is of low value.

Whilst the impact of AASB 16 has not yet been quantified, the entity currently has operating lease commitments for $112.886 million. The department anticipates most of this amount will be brought onto the statement of financial position, excepting amounts pertinent to short term or low value leases. Interest and amortisation expense will increase and rental expense will decrease.

1 Jan 2019

AASB 1058 Income of Not-for-Profit Entities

This Standard clarifies and simplifies the income recognition requirements that apply to Not-for-Profit (NFP) entities, more closely reflecting the economic reality of NFP entity transactions that are not contracts with customers. Timing of income recognition is dependent on whether such a transaction gives rise to a liability, a performance obligation (a promise to transfer a good or service), or, an obligation to acquire an asset. The department has not yet determined the application or the potential impact of the Standard.

1 Jan 2019

AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 120, 121, 127, 128, 131, 132, 136, 137, 139, 1023 and 1038 and Int 2, 5, 10, 12, 19 and 127]

This Standard makes consequential amendments to other Australian Accounting Standards and Interpretations as a result of issuing AASB 9 in December 2010.

The mandatory application date of this Standard has been amended by AASB 2012-6 and AASB 2014-1 to 1 January 2018. The department has not yet determined the application or the potential impact of the Standard.

1 Jan 2018

AASB 2014-1 Amendments to Australian Accounting Standards

Part E of this Standard makes amendments to AASB 9 and consequential amendments to other Standards. It has not yet been assessed by the department to determine the application or the potential impact of the Standard.

1 Jan 2018

AASB 2014-5 Amendments to Australian Accounting Standards arising from AASB 15

This Standard gives effect to the consequential amendments to Australian Accounting Standards (including Interpretations) arising from the issuance of AASB 15. The mandatory application date of this Standard has been amended by AASB 2015-8 to 1 January 2018. The department has not yet determined the application or the potential impact of the Standard.

1 Jan 2018



Standard



AASB 2014-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2014)

This Standard gives effect to the consequential amendments to Australian Accounting Standards (including Interpretations) arising from the issuance of AASB 9 (December 2014). The department has not yet determined the application or the potential impact of the Standard.

1 Jan 2018

AASB 2014-10 Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture [AASB 10 and 128]

This Standard amends AASB 10 and AASB 128 to address an inconsistency between the requirements in AASB 10 and those in AASB 128 (August 2011), in dealing with the sale or contribution of assets between an investor and its associate or joint venture. The mandatory effective date (application date) for the Standard has been deferred to 1 Jan 2018 by AASB 2015-10. The department has determined that the Standard has no financial impact.

1 Jan 2018

AASB 2015-8 Amendments to Australian Accounting Standards – Effective Date of AASB 15

This Standard amends the mandatory effective date (application date) of AASB 15 Revenue from Contracts with Customers so that AASB 15 is required to be applied for annual reporting periods beginning on or after 1 January 2018 instead of 1 January 2017. For Not-for-Profit entities, the mandatory effective date has subsequently been amended to 1 January 2019 by AASB 2016-7. The department has not yet determined the application or the potential impact of AASB 15.

1 Jan 2019

AASB 2016-2 Amendments to Australian Accounting Standards - Disclosure Initiative: Amendments to AASB 107

This Standard amends AASB 107 Statement of Cash Flows (August 2015) to require disclosures that enable users of financial statements to evaluate changes in liabilities arising from cash flows and non-cash changes. There is no financial impact.

1 Jan 2017

AASB 2016-3 Amendments to Australian Accounting Standards - Clarifications to AASB 15

This Standard clarifies identifying performance obligations, principal versus agent considerations, timing of recognising revenue from granting a licence, and, provides further transitional provisions to AASB 15. The department has not yet determined the application or the potential impact.

1 Jan 2018

AASB 2016-4 Amendments to Australian Accounting Standards – Recoverable Amount of Non-Cash-Generating Specialised Assets of Not-for-Profit Entities

This Standard clarifies that the recoverable amount of primarily non-cash-generating assets of not-for-profit entities, which are typically specialised in nature and held for continuing use of their service capacity, is expected to be materially the same as fair value determined under AASB 13 Fair Value Measurement. The department has not yet determined the application or the potential impact.

1 Jan 2017



Standard



AASB 2016-7 Amendments to Australian Accounting Standards – Deferral of AASB 15 for Not-for-Profit Entities

This Standard amends the mandatory effective date (application date) of AASB 15 and defers the consequential amendments that were originally set out in AASB 2014-5 Amendments to Australian Accounting Standards arising from AASB 15 for Not-for-Profit entities to annual reporting periods beginning on or after 1 January 2019, instead of 1 January 2018. There is no financial impact.

1 Jan 2017

AASB 2016-8 Amendments to Australian Accounting Standards – Australian Implementation Guidance for Not-for-Profit Entities

This Standard inserts Australian requirements and authoritative implementation guidance for Not-for-Profit entities into AASB 9 and AASB 15. This guidance assists Not-for-Profit entities in applying those Standards to particular transactions and other events. There is no financial impact.

1 Jan 2019

AASB 2017-2 Amendments to Australian Accounting Standards – Further Annual Improvements 2014–2016 Cycle

This Standard clarifies the scope of AASB 12 by specifying that the disclosure requirements apply to an entity’s interests in other entities that are classified as held for sale, held for distribution to owners in their capacity as owners or discontinued operations in accordance with AASB 5. There is no financial impact.

1 Jan 2017

Changes in Accounting EstimatesThere were no changes in accounting estimates for the financial year.

4. Employee benefits2017$’000

2016$’000

Wages and salaries 66,326 64,911Severance payments - voluntary severance (a) 621 982Superannuation - defined contribution plans (b) 7,620 7,511Long service leave 2,528 2,766Annual leave 6,804 6,524Other related expenses (c) 1,158 1,074

85,057 83,769

(a) The total amount paid by the department for voluntary severances for 2017 was $0.844m (2016: $1.305m) with the leave component of 2017: $0.223m (2016: $0.323m) being paid from the provisions account.

(b) Defined contribution plans include West State, Gold State, GESB and other eligible funds.

(c) Includes the value of the fringe benefit to the employee plus the fringe benefit tax component.

Employment on-costs such as workers’ compensation insurance are included at Note 11 ‘Other expenses’. The employment on-costs liability is included at Note 31 ‘Provisions’.



5. Compensation of Key Management Personnel

The key management personnel include Ministers and senior officers of the department. However, the department is not obligated to compensate Ministers and therefore disclosures in relation to Ministers’ compensation may be found in the Annual Report on State Finances.Total compensation for senior officers of the department for the reporting period are presented within the following bands:

$ 2017 201620,001 – 30,000 - 140,001 – 50,000 - 180,001 – 90,000 - 1

100,001 – 110,000 - 1110,001 – 120,000 - 2150,001 – 160,000 - 2160,001 – 170,000 2 -200,001 – 210,000 1 -230,001 – 240,000 1 1250,001 – 260,000 1 -260,001 – 270,000 1 2270,001 – 280,000 1 1290,001 – 300,000 1 -310,001 – 320,000 1 -330,001 – 340,000 - 1

$’000 $’000Short-term employee benefits 1,787 1,786

Post-employment benefits 199 199Other long-term benefits 195 199

Total remuneration of senior officers 2,181 2,184

The total remuneration includes the superannuation expense incurred by the department in respect of senior officers.The decrease in Senior Officers in 2016–17 is mainly due to less movement within the Senior Officer positions over the year.Senior officers are those Key Management Personnel being responsible for planning, directing and controlling the activities of the department.

6. Supplies and services2017$’000

2016$’000

Communications 1,044 822Consultants and contractors 14,518 15,360Consumables 1,613 1,618Materials 898 912Insurance 412 531Motor vehicles 1,014 931Maintenance 462 451Travel 478 354Other (a) 4,102 3,237

24,543 24,216

(a) Other expenses mainly comprises of expenses relating to software licences, and freight and mail services.



7. Depreciation and amortisation2017$’000

2016$’000

DepreciationComputer hardware and communications 1,062 886Furniture and fittings 151 174Office equipment 169 159Buildings 126 146Leasehold improvement 71 32

Total depreciation 1,580 1,398Amortisation

Licences 71 73Computer software 2,449 2,800

Total amortisation 2,520 2,873Total depreciation and amortisation 4,100 4,271

8. Finance costsInterest 22 24

22 24

9. AccommodationLease rentals 7,910 9,575Repairs and maintenance 207 192 Cleaning 246 268 Services received free of charge 539 648

8,902 10,683

10. Grants and subsidiesRecurrent

Farmsafe WA 70 100Asbestos Diseases Society 100 70Industry and Innovation 1,147 1,116Royalties for Regions - Regional Buy Local Initiatives - Stage 2 - 87Royalties for Regions - Regional Mobile Telecommunications Project - Stage 2 10,425 9,138

Property Industry Grants 5,945 5,092Australian Building Codes Board 580 580Building Commission 100 100Seniors Housing Information Service - 309Other Miscellaneous - contributions to Commonwealth and others 24 30

18,391 16,621



11. Other expenses2017$’000

2016$’000

Other expenses (a) 9,133 1,7259,133 1,725

Other expenses mainly comprises of expenditure related to:Rental Accommodation Account - write back 2015–16 recoup (b) 5,526 -Expensing of information systems development costs (c) 2,926 -

(a) Includes workers’ compensation insurance and other employment on-costs. The on-costs liability associated with the recognition of annual and long service leave liability is included at Note 31 ‘Provisions’. Superannuation contributions accrued as part of the provision for leave are employee benefits and are not included in employment on-costs.

(b) There were concerns over the sustainability of the administered Rental Accommodation Account (RAA) arising out of the sustained period of low interest rates. Therefore, the department obtained Government approval to not receive its reimbursement of the 2015–16 bonds administration costs incurred under the Residential Tenancies Act 1987 from the administered RAA. Consequently, Other Expenses for 2016–17 include a reversal of $5.5m for the revenue accrued in the 2015–16 financial year.

(c) Other Expenses includes the expensing of information systems development costs incurred during the year ($1.795m), and the write down of prior year development and implementation costs ($1.131m) that, through a combination of contractual issues and technology developments, were assessed as not qualifying for classification as intangible assets at year’s end.

12. Related Party TransactionsThe department is a wholly owned and controlled entity of the State of Western Australia.Related parties of the department include:• all Ministers and their close family members, and their controlled or jointly controlled entities;• all senior officers and their close family members, and their controlled or jointly controlled entities;• other departments and public sector entities, including related bodies included in the whole of

government consolidated financial statements;• associates and joint ventures, that are included in the whole of government consolidated financial

statements; and• the Government Employees Superannuation Board (GESB).

Significant transactions with government related entitiesSignificant transactions include:• service appropriations (Note 19);• services received free of charge (Note 19);• Royalties for Regions Fund (Note 19);• lease rental payments to the Department of Finance (Note 9);• motor vehicle lease payments of $0.82 million to the Department of Finance (Note 6);• commitments for future lease payments to the Department of Finance (Note 37);• remuneration for services provided by the Auditor General (Note 41); and• insurance payments to the Insurance Commission of W.A. (Note 6).Material transactions with other related parties• superannuation payments to GESB of $7.0 million (Note 4).

The department had no material related party transactions with Ministers/senior officers or their close family members or their controlled (or jontly controlled) entities for disclosure.




13. User charges and fees and sales2017$’000

2016$’000

User charges and fees 61,480 71,386Sales 114 190The user charges and fees arise from the department's services in the following areas:

Rental Accommodation Account (a) - 5,526WorkSafe 5,879 6,242EnergySafety 14,690 13,965Motor Vehicle Dealers and Repairers 2,312 2,219Consumer Protection 12,102 14,002Building Commission 24,523 27,415Other 1,974 2,017

Total User Charges and Fees 61,480 71,386SalesGeneral 104 177Publications 10 13

Total Sales 114 190

(a) Refer to Note 11 (b).

14. Commonwealth grants and contributionsCommonwealth funding received during the year 418 362

418 362

15. Other revenueMiscellaneous revenue for various recoups, contributions, interest, refunds etc. 6,158 6,326

6,158 6,326Other revenue mainly comprises of revenue received from:

Interest received 3,161 3,617Prior year recoups from Administered fund - 1,233

16. Revaluation decrementsRevaluation decrements 117 -

117 -

17. Net gain/(loss) on disposal of non-current assetsThere were no gains or losses from the disposal of non-current assets.



18. Other gains2017$’000

2016$’000

Impairment gainComputer hardware 10 -Furniture and fittings 1 -

Revaluation gainBuildings - 146

11 146

19. Income from State GovernmentAppropriation received during the year:

Service appropriation (a) 58,028 42,69058,028 42,690

Services received free of charge from other State Government agencies during the period:

Department of Finance - Building Management and Works 539 648State Solicitor's Office 332 327Department of Finance (Procurement) - 120Western Australian Land Information Authority (Landgate) - 22

871 1,116Royalties for Regions Fund: (b)Regional Community Services Account 524 138Regional Infrastructure and Headworks Account 9,343 10,000

9,867 10,13868,766 53,944

(a) Service appropriations fund the net cost of services delivered. Appropriation revenue comprises a cash component and a receivable (asset). The receivable (holding account) comprises the budgeted depreciation expense for the year and any agreed increases in leave liability during the year.

(b) This is a sub-fund within the over-arching ‘Royalties for Regions Fund’. The recurrent funds are committed to projects and programs in WA regional areas.



20. Restricted cash and cash equivalents2017$’000

2016$’000

Current (a)Consumer Credit Act (WA) 103 103Departmental Receipts in Suspense 22 80State Trading Concerns 1,131 1,053Motor Vehicle Repair (MVR) Industry Education and Research Account 132 115

Motor Vehicle Repair (MVR) Industry Compensation Account 120 106Co-operatives Companies Liquidation Account 12 12EnergySafety Account 12,061 11,239Real Estate - Education and General Purpose Account 25,332 28,428Real Estate - Fidelity Guarantee Account 45,578 44,742Real Estate - Home Buyers Assistance Account 15,235 16,426Real Estate and Business Agents Supervisory Board Trust Account 362 354Settlement Agents - Education and General Purpose Account 26,685 25,912Settlements Agents - Fidelity Guarantee Account 45,790 43,800Building Services Trust Dispute Remedies - 42Building Services Account 15,165 15,522

187,729 187,934

Indian Ocean Territories - Commonwealth Government 37 107Royalties for Regions Fund 2,061 2,781

2,098 2,888Total current 189,827 190,822

Non-currentAccrued salaries suspense account (b) 285 -

Total non-current 285 -

Total restricted cash and cash equivalents 190,112 190,822

(a) Refer to Note 44 ‘Special Purpose Accounts and Restricted Cash Accounts’ for explanation of nature of restriction.

(b) Funds held in the suspense account for the purpose of meeting the 27th pay in a financial year that occurs every 11 years.



21. Receivables 2017$’000

2016$’000

CurrentTrade debtors 302 414Allowance for impairment of receivables (4) (26)GST receivables 1,353 1,167Accrued revenue 3,099 9,081

4,750 10,636Loans (a) 282 126

Total current 5,032 10,762Non-Current

Loans (a) 9,657 10,024Total non-current 9,657 10,024Total receivables 14,689 20,786

(a) The carrying amount of loans receivable approximates their fair value.

Reconciliation of changes in the allowance for impairment of receivables:Balance at start of period 26 26Amounts written off during the period (18) -Amount recovered during the period (3) -Balance at the end of the period 4 26

The department does not hold any collateral as security or other credit enhancements relating to receivables.

22. Amounts receivable for services (Holding Account)Current 2,974 53Non-current 11,826 11,638Total amounts receivable for services 14,800 11,691

Represents the non-cash component of service appropriations. See Note 2(o) ‘Amounts Receivable for Services (Holding Account)’. It is restricted in that it can only be used for asset replacement or payment of leave liability.

23. Other current assetsCurrentPrepayments 1,577 722Miscellaneous assets such as credit card and travel clearing accounts etc. 78 18

1,655 741



24. Property, plant and equipment2017$’000

2016$’000

Land (a)At fair value 34,073 36,136

34,073 36,136Buildings (a)

At fair value 4,813 5,0564,813 5,056

LeaseholdAt cost 456 351Accumulated depreciation (102) (45)

354 306Computer hardware and communications

At cost 4,905 4,741Accumulated depreciation (3,481) (2,648)Accumulated impairment losses - (15)

1,425 2,077Furniture and fittings

At cost 1,679 2,295Accumulated depreciation (1,278) (1,654)Accumulated impairment losses - (91)

401 551Office equipment

At cost 1,004 1,177Accumulated depreciation (614) (652)Accumulated impairment losses - (8)

390 517Total

At cost/fair value 46,929 49,757Accumulated depreciation (5,475) (5,000)Accumulated impairment losses - (114)

Total property, plant and equipment 41,455 44,644

(a) Land and buildings were revalued as at 1 July 2016 by the Western Australian Land Information Authority (Valuation Services). The valuations were performed during the year ended 30 June 2017 and recognised at 30 June 2017. In undertaking the revaluation, fair value was determined by reference to market values, for land $33,670,462 (2016: $35,734,150) and buildings $4,812,696 (2016: $5,056,384), or otherwise to its current use value for land $402,250 (2016: $402,150). Formation of fair value measurements are provided in Note 26 ‘Fair Value Measurement’.



Reconciliations

Reconciliations of the carrying amounts of property, plant and equipment at the beginning and end of the reporting period are set out below.

2017$’000

2016$’000

LandCarrying amount at start of period 36,136 36,116Revaluation (2,064) 20Carrying amount at end of period 34,073 36,136

BuildingsCarrying amount at start of period 5,056 5,056Revaluation (117) 146Depreciation (126) (146)Carrying amount at end of period 4,813 5,056

LeaseholdCarrying amount at start of period 306 203Additions 119 135Depreciation (71) (32)Carrying amount at end of period 354 306

Computer hardware and communicationsCarrying amount at start of period 2,077 2,119Additions 414 994Depreciation (1,062) (886)Impairment losses - (6)Impairment gains 10 -Account reclassification (14) (144)Carrying amount at end of period 1,425 2,077

Furniture and fittingsCarrying amount at start of period 551 807Additions - 8Depreciation (151) (174)Impairment losses - (91)Impairment gains 1 -Carrying amount at end of period 401 551

Office equipmentCarrying amount at start of period 517 401Additions 37 169Depreciation (169) (159)Impairment losses - (3)Account reclassification 5 112Carrying amount at end of period 390 517



2017$’000

2016$’000

Total - property, plant and equipmentCarrying amount at start of period 44,644 44,702Additions 570 1,307Revaluation (2,181) 166Depreciation (1,580) (1,398)Impairment losses - (99)Impairment gains 11 -Account reclassification (9) (32)Carrying amount at end of period 41,455 44,644

25. Non-current assets classified as held for sale (Buildings)The department has no buildings held for sale.

26. Fair value measurements

Assets measured at fair value Level 1 Level 2 Level 3 Fair Value

2017 $’000 $’000 $’000At end of period

$’000

Land (Note 24) - 33,671 402 34,073Buildings (Note 24) - 4,813 - 4,813

- 38,483 402 38,885

Assets measured at fair value Level 1 Level 2 Level 3 Fair Value

2016 $’000 $’000 $’000At end of period

$’000

Land (Note 24) - 35,734 402 36,136Buildings (Note 24) - 5,056 - 5,056

- 40,791 402 41,193

There were no transfers between Levels 1, 2 or 3 during the current and the previous period.

Valuation techniques to derive Level 2 fair values

Level 2 fair values of land and buildings were derived using the market approach. Market evidence of sales prices of comparable land and buildings (office accommodation) in close proximity is used to determine price per square metre.

Fair value measurements using significant unobservable inputs (Level 3)

Land 2017$’000

Land 2016$’000

Fair value at start of period 402 402Revaluation increments/(decrements) recognised in Other Comprehensive Income - -

Fair Value at end of period (a) 402 402

(a) Restricted land for road verges, pump station and drain sump



Valuation process

There were no changes in valuation techniques during the period.

Transfers in and out of a fair value level are recognised on the date of the event or change in circumstances that caused the transfer. Transfers are generally limited to assets newly classified as non-current assets held for sale as Treasurer’s instructions require valuations of land and buildings to be categorised within Level 3 where the valuations will utilise significant Level 3 inputs on a recurring basis.

Land (Level 3 fair values)

Fair value for restricted use land is based on market value, by either using market evidence of sales of comparable land that is unrestricted less restoration costs to return the site to a vacant and marketable condition (low restricted use land), or, comparison with market evidence for land with low level utility (high restricted use land). Relevant comparators of land with low level utility are selected by the Western Australian Land Information Authority (Valuation Services) and represents the application of a significant Level 3 input in this valuation methodology. The fair value measurement is sensitive to values of comparator land, with higher values of comparator land correlating with higher estimated fair values of land.

Information about significant unobservable inputs (Level 3) in fair value measurement.

Description

Fair value2017$000

Fair value2016$000

Valuation technique(s)

Unobservable Inputs

Land 402 402 Market approachSelection of

land with similar approximate utility

Reconciliations of the opening and closing balances are provided in Note 24 ‘Property, plant and equipment’.

Basis of valuation

In the absence of market-based evidence, due to the specialised nature of some non-financial assets, these assets are valued at Level 3 of the fair value hierarchy on an existing use basis. The existing use basis recognises that restrictions or limitations have been placed on their use and disposal when they are not determined to be surplus to requirements. These restrictions are imposed by virtue of the land (for road verges, drain sump, pump station) being held to deliver a specific community service (Technology Park Bentley).



27. Intangible assets2017$’000

2016$’000

Computer softwareAt cost 19,742 16,882Accumulated amortisation (12,714) (10,236)

7,028 6,647Licences

At cost 247 911Accumulated amortisation (235) (164)

12 747Software development in progress

At cost 3,279 2,1443,279 2,144

TotalAt cost 23,268 19,938Accumulated amortisation (12,949) (10,400)Total intangible assets 10,319 9,538

ReconciliationsComputer software

Carrying amount at start of period 6,647 6,927Additions 8 240Reclassification (2) -Transfer - completed software 2,824 2,279Amortisation (2,449) (2,800)Carrying amount at end of period 7,028 6,647

LicencesCarrying amount at start of period 747 138Additions - 682Reclassification (285) -Amortisation (71) (73)Asset write down (380) -Carrying amount at end of period 12 747

Software development in progressCarrying amount at start of period 2,144 700Additions 4,710 3,772Transfer - completed software (2,824) (2,279)Reclassification 2 (49)Asset write down (752) -Carrying amount at end of period 3,279 2,144

Total - intangibles assetsCarrying amount at start of period 9,538 7,765Additions 4,718 4,695Reclassification (285) (49)Amortisation (2,520) (2,873)Asset write down (1,131) -Carrying amount at end of period 10,319 9,538



28. Impairment of assets2017$’000

2016$’000

Computing hardware and communications - 6Furniture and fittings - 91Office equipment - 3Debtors - 24

- 123

29. PayablesCurrent

Trade payables 1,519 2,347Accrued expenses 3,032 2,087Accrued salaries 337 54

4,888 4,488Non-current (a)Trust Accounts

Consumer Credit Act (WA) 103 103Departmental Receipts in Suspense 22 77Building Services Trust Dispute Remedies Account - 42Real Estate and Business Agents Supervisory Board 363 356Co-operatives - Companies Liquidation Account 12 12

500 589Refer to Note 36 ‘Financial Instruments’ and Note 2(l) ‘Financial Instruments’.

(a) Refer to Note 44 ‘Special Purpose Accounts and Restricted Cash Accounts’ for the nature of these payables.

30. BorrowingsNon-current LandCorp (Enterprise Units Development Agreement) 771 771

771 771

Amount of loan facility owed by the Department of Commerce to LandCorp.



31. Provisions2017$’000

2016$’000

CurrentEmployee benefits provisionAnnual leave (a) 6,278 5,856Long service leave (b) 12,023 12,292Deferred salary scheme (c) 177 98Purchased leave (d) 91 99

Other provisionsEmployment on-costs (e) 76 74

Total current provisions 18,645 18,420Non-current

Employee benefits provisionLong service leave (b) 3,626 3,660

Other provisionsEmployment on-costs (e) 15 15

Total non-current provisions 3,641 3,675

(a) Annual leave liabilities have been classified as current as there is no unconditional right to defer settlement for at least 12 months after the reporting period. Assessments indicate that actual settlement of the liabilities will occur as follows:

Within 12 months of the end of the reporting period 4,500 4,269More than 12 months after the reporting period 1,778 1,588

6,278 5,856

(b) Long service leave liabilities have been classified as current where there is no unconditional right to defer settlement for at least 12 months after the reporting period. Assessments indicate that actual settlement of the liabilities will occur as follows:

Within 12 months of the end of the reporting period 4,841 4,955More than 12 months after the reporting period 10,809 10,997

15,649 15,952

(c) Deferred salary scheme liabilities have been classified as current where there is no unconditional right to defer settlement for at least 12 months after the end of the reporting period. Actual settlement of the liabilities is expected to occur as follows:

Within 12 months of the end of the reporting period - - More than 12 months after the reporting period 177 98

177 98



2017$’000

2016$’000

(d) Purchased leave liabilities have been classified as current where there is no unconditional right to defer settlement for at least 12 months after the end of the reporting period. Actual settlement of the liabilities is expected to occur as follows:Within 12 months of the end of the reporting period 91 99More than 12 months after the reporting period - -

91 99

(e) The settlement of annual and long service leave liabilities gives rise to the payment of employment on-costs including workers’ compensation insurance. The provision is the present value of expected future payments.

Movements in other provisions

Movements in each class of provisions during the financial year, other than employee benefits, are set out below.

Employment on-cost provision

Carrying amount at start of period 89 106Additional/(reversals of) provisions recognised 3 (17)Carrying amount at end of period 92 89

32. Unearned revenuesCurrent

Unearned revenue (a) 9,824 9,2279,824 9,227

Non-currentUnearned revenue (a) 9,601 8,665

9,601 8,665

(a) Unearned revenues are revenue received in advance for multiple year licences for EnergySafety, Motor Vehicle Repairers, Plumbers, Real Estate, Settlement Agents, Painters, Builders and Building Surveyors. This revenue will be recognised from 2017–18 and subsequent years.

33. Other liabilitiesCurrent

Miscellaneous liabilities such as stale and returned cheques, refunds etc. 367 341

367 341



34. Equity2017$’000

2016$’000

The Government holds the equity interest in the department on behalf of the community. Equity represents the residual interest in the net assets of the department. The asset revaluation surplus represents that portion of equity resulting from the revaluation of non-current assets.Contributed equity

Balance at the start of the period 78,356 78,953Contributions by owners

Capital appropriation - -Total contributions by owners - -Distribution to owners

Transfer of net assets to other agencies:Department of Treasury (717) (597)

Total distributions to owners (717) (597)Balance at the end of period 77,639 78,356

ReservesAsset revaluation surplus:

Balance at the start of period 11,036 11,016Net revaluation increments/(decrements)

Land (2,064) 20Balance at end of period 8,972 11,036

Accumulated surplusBalance at start of period 159,161 168,238Result for the period (13,317) (9,078)Balance at end of period 145,843 159,161

Total Equity at end of period 232,455 248,552



35. Notes to the Statement of Cash Flows2017$’000

2016$’000

Reconciliation of cash

Cash at the end of the financial year as shown in the Statement of Cash Flows is reconciled to the related items in the Statement of Financial Position as follows:Cash and cash equivalents 7,663 16,506Restricted cash and cash equivalents (refer to Note 20) 190,112 190,822

197,774 207,328

Reconciliation of net cost of services to net cash flows provided by/(used in) operating activitiesNet cost of services (82,083) (63,022)Non-cash items:

Depreciation and amortisation expense (Note 7) 4,100 4,271Services received free of charge (Note 19) 871 1,116Net revaluation (increment)/decrement (Note 16) 117 (146)Reclassification of assets (Note 24 and 27) 294 81Impairment loss (Note 28) - 123Impairment gain (Note 18) (11) -Asset write down (Note 27) 1,131 -

(Increase)/decrease in assets:Current receivables (a) 5,143 (5,888)Other current assets (914) (376)

Increase/(decrease) in liabilities:Current payables (a) 400 (3,828)Current unearned revenue 597 1,320Current provisions 226 (474)Other current liabilities 26 -Non-current payables (89) 59Non-current unearned revenue 936 1,514Non-current provisions (34) (76)Other non-current liabilities - 164Net GST receipts/(payments) (b) 955 222Net cash provided by/(used in) operating activities (68,336) (64,940)

(a) Note that the Australian Taxation Office (ATO) receivable/payable in respect of GST and the receivable/payable in respect of the sale/purchase of non-current assets are not included in these items as they do not form part of the reconciling items.

(b) This is the net GST paid/received, i. e. cash transactions.

36. Financial instruments(a) Financial Risk Management Objectives and Policies

Financial instruments held by the department are cash and cash equivalents, restricted cash and cash equivalents, loans and receivables, payables and borrowings. The department has limited exposure to financial risks. The department’s overall risk management program focuses on managing the risks identified below.



Credit risk

Credit risk arises when there is the possibility of the department’s receivables defaulting on their contractual obligations resulting in financial loss to the department.

The maximum exposure to credit risk at the end of the reporting period in relation to each class of recognised financial assets is the gross carrying amount of those assets inclusive of any provisions for impairment, as shown in the table at Note 36(c) ‘Financial instruments disclosures’ and Note 21 ‘Receivables’.

Credit risk associated with the department’s financial assets is minimal, mainly comprised of receivables that are in the nature of loans to third parties and the amounts receivable for services (holding account). For receivables other than government, the department trades only with recognised, creditworthy third parties. The department has policies in place to ensure that sales of products, services and loans are made to customers with an appropriate credit history. In addition, receivable balances are monitored on an ongoing basis with the result that the department’s exposure to bad debts is minimal. There are no significant concentrations of credit risk other than a loan receivable $10.8 million to a company with annual repayments maturing 2025 (2016: $11.6 million ).

Allowance for impairment of financial assets is calculated based on objective evidence such as observable data in client credit ratings. For financial assets that are either past due or impaired, refer to Note 35(c).

Liquidity risk

The department is exposed to liquidity risk through its trading in the normal course of business. Liquidity risk arises when the department is unable to meet its financial obligations as they fall due. The department has appropriate procedures to manage cash flows including drawdowns of appropriations by monitoring forecast cash flows to ensure that sufficient funds are available to meet its commitments.

Market risk

The department does not trade in foreign currency and is not materially exposed to other price risks (for example, equity securities or commodity prices changes). The department’s exposure to market risk relates to changes in interest rates on a long term debt with LandCorp, and funds held in real estate and settlement agents restricted cash accounts. Other than this, the department is not exposed to interest rate risk because all other cash and cash equivalents and restricted cash are non-interest bearing.

(b) Categories of Financial Instruments

In addition to cash and cash equivalents, the carrying amounts of each of the following categories of financial assets and financial liabilities at the end of the reporting period are as follows.

2017$’000

2016$’000

Financial AssetsCash and cash equivalents 7,663 16,506 Restricted cash and cash equivalents 190,112 190,822 Loans and receivables (i) 13,336 19,619 Amount receivable for services 14,800 11,691

Financial LiabilitiesFinancial liabilities measured at amortised cost 6,159 5,849

(i) The amount of receivables excludes GST recoverable from the ATO (statutory receivable).



(c) Financial Instrument Disclosures

Credit risk

The following table details the department’s maximum exposure to credit risk and the ageing analysis of financial assets. The department’s maximum exposure to credit risk at the end of the reporting period is the carrying amount of financial assets as shown below. The table discloses the ageing of financial assets that are past due but not impaired and impaired financial assets. The table is based on information provided to senior management of the department.

The department does not hold collateral as security or other credit enhancement relating to the financial assets it holds.

Aged analysis of financial assets

Past due but not impaired

Carrying amount

$’000

Not past due

and not impaired

$’000

Up to 1 month

$’000

1 to 3 months

$’000

3 months

to 1 year $’000

1 to 5 years $’000

More than

5 years $’000

Impaired financial

assets $’000

Financial Assets2017Cash and cash equivalents 7,663 7,663 - - - - - -

Restricted cash and cash equivalents

190,112 190,112 - - - - - -

Receivables (a) 3,397 3,393 - - - 4 - -Loans receivable 9,939 9,939 - - - - - -Amounts receivable for services

14,800 14,800 - - - - - -

225,910 225,907 - - - 4 - -2016Cash and cash equivalents 16,506 16,506 - - - - - -


190,822 190,822 - - - - - -

Receivables (a) 9,469 9,406 43 3 13 5 - -Loans receivable 10,150 10,150 - - - - - -Amounts receivable for services

11,691 11,691 - - - - - -

238,638 238,575 43 3 13 5 - -

(a) The amount of receivables excludes the GST recoverable from the ATO (statutory receivable).



Liquidity risk and interest rate exposure

The following table details the department’s interest rate exposure and the contractual maturity analysis of financial assets and financial liabilities. The maturity analysis section includes interest and principal cash flows. The interest rate exposure section analysis only the carrying amounts of each item.

Interest rate exposure and maturity analysis of financial assets and financial liabilities

Interest rate exposure

Nominal amount

$’000

Maturity datesWeighted

average effective interest

rate %

Carrying amount

$’000

Fixed interest

rate $’000

Variable interest

rate $’000

Non-interest bearing

$’000

Up to 1 months

$’000

1 to 3 months

$’000

3 months

to 1 year

$’000

1 to 5 years $’000

More than

5 years $’000

2017Financial AssetsCash and cash equivalents - 7,663 - - 7,663 7,663 7,663 - - - -


1.98% 190,112 - 158,983 31,128 190,112 189,827 - - - 285

Receivables (a) - 3,397 - - 3,397 3,397 3,397 - - - -Loans receivable - 9,939 - - 9,939 9,939 - - - 282 9,657Amounts receivable for services

- 14,800 - - 14,800 14,800 113 - - 14,687 -

225,910 - 158,983 66,927 225,910 201,000 - - 14,969 9,941 Financial LiabilitiesPayables - 5,388 - - 5,388 5,388 5,388 - - - -Borrowings 2.79% 771 - 771 - 771 - - - - 771

6,159 - 771 5,388 6,159 5,388 - - - 771




Interest rate exposure and maturity analysis of financial assets and financial liabilities

Interest rate exposure

Nominal amount

$’000

Maturity datesWeighted

average effective interest

rate %

Carrying amount

$’000

Fixed interest

rate $’000

Variable interest

rate $’000

Non-interest bearing

$’000

Up to 1 months

$’000

1 to 3 months

$’000

3 months

to 1 year

$’000

1 to 5 years $’000

More than

5 years $’000

2016Financial AssetsCash and cash equivalents - 16,506 - - 16,506 16,506 16,506 - - - -

Restricted cash and cash equivalent

2.28% 190,822 - 159,663 31,159 190,822 190,822 - - - -

Receivables (a) - 9,469 - - 9,469 9,469 9,469 - - - -Loans receivable - 10,150 - - 10,150 10,150 - - - 126 10,024Amounts receivable for services

- 11,691 - - 11,691 11,691 53 - - 11,638 -

238,638 - 159,663 78,975 238,638 216,850 - - 11,764 10,024Financial LiabilitiesPayables - 5,078 - - 5,078 5,078 5,078 - - - -Borrowings 3.14% 771 - 771 - 771 - - - - 771

5,849 - 771 5,078 5,849 5,078 - - - 771


Interest rate sensitivity analysis

The following table represents a summary of the interest rate sensitivity of the department’s financial assets and liabilities at the end of the reporting period on the surplus for the period and equity for a 1 per cent change in interest rates. It is assumed that the change in interest rates is held constant throughout the reporting period.

Carrying amount

$’000

-100 basis points +100 basis pointsSurplus

$’000Equity $’000

Surplus $’000

Equity $’000

2017Financial AssetsRestricted cash and cash equivalents 158,983 (1,590) (1,590) 1,590 1,590

Financial LiabilitiesBorrowings 771 8 8 (8) (8)Total increase/(decrease) (1,582) (1,582) 1,582 1,582



Carrying amount

$’000

-100 basis points +100 basis pointsSurplus

$’000Equity $’000

Surplus $’000

Equity $’000

2016Financial AssetsRestricted cash and cash equivalents 159,663 (1,597) (1,597) 1,597 1,597

Financial LiabilitiesBorrowings 771 8 8 (8) (8)Total increase/(decrease) (1,589) (1,589) 1,589 1,589

Fair values

All financial assets and liabilities recognised in the Statement of Financial Position, whether they are carried at cost or fair value, are recognised at amounts that represent a reasonable approximation of fair value unless otherwise stated in the applicable notes.

37. Commitments2017$’000

2016$’000

The commitments below are inclusive of GST.

Non cancellable operating lease commitments

The department has a number of property leases for its operations both within the metropolitan area and country regions. The leases have various terms and conditions and expiry dates including rent reviews. Also included is the fleet motor vehicle lease costs.

Commitments for minimum lease payments are payable as follows:

Within 1 year 8,507 9,600Later than 1 year and not later than 5 years 60,284 44,338Later than 5 years 44,094 64,928

112,886 118,865

The property leases are non-cancellable leases with various terms, with rent payable monthly in advance. Contingent rent provisions within the lease agreements require that the minimum lease payments shall be increased by the lower of CPI or 4 per cent per annum. An option exists to renew the leases at the end of the various terms for additional terms.

Capital expenditure commitments

Capital expenditure commitments, being contracted capital expenditure additional to the amounts reported in the financial statements, are payable as follows:

Within 1 year 5,465 6,365Later than 1 year and not later than 5 years - -Later than 5 years - -

5,465 6,365



Other expenditure commitments

Other expenditure commitments for day to day operations contracted for at the end of the reporting period but not recognised as liabilities, are payable as follows:

2017$’000

2016$’000

Within 1 year 2,470 2,947Later than 1 year and not later than 5 years - - Later than 5 years - -

2,470 2,947

38. Contingent Liabilities and Contingent Assets

Contingent Liabilities (Controlled)Industry and Technology Development Act As the responsible Minister under the Industry and Technology Development Act of 1998 (ITD Act), the Minister for Commerce (or his predecessors) is a signatory to one Investment Security Guarantee (ISG). ISGs are signed by the Minister, General Manager of the Forest Products Commission (FPC) and timber processors. Under an ISG, the Minister is liable to pay compensation under certain circumstances where the Forest Products Commission (FPC) is unable to supply contracted amounts of timber. The total contingent liability for the one ISG at 30 June 2017 was $11.7m. The responsibility for the ITD Act has been transferred to the Department of Jobs, Tourism, Science and Innovation with effect on and from 1 July 2017.

Fidelity Guarantee Account (FGA) Claims

A total of 40 claims against the Fidelity Guarantee Accounts with a total value of $531,024.94 consisting of:

(a) 2 claims against the Settlement Agents FGA yet to be decided and with a total value of $103,045.85.

(b) 38 claims against the Real Estate Agents FGA yet to be decided to the value of $427,978.09

(c) No claims in dispute (appealed) at this time.

These figures do not include legal costs or any interest claims. Reasonable legal costs are claimable. Claims for interest are not allowable, as per proceedings in the Supreme Court after the State Administrative Tribunal decided that interest wasn’t allowable.

Motor Vehicle Repairers Act 2003

There may be a number of claims from affected parties for a total value up to $84,000. Any claims are contingent on the consumer exhausting other recovery processes.

Contingent Liabilities (Administered)Home Indemnity Insurance

The contingent liability for Home Indemnity Insurance (HII) has been assessed to be the future claims liability (FCL) as at 30 June 2017. The FCL is an estimation of the future claims costs which will arise as a result of events which will occur in the future for currently in-force HII policies. In accordance with the PricewaterhouseCoopers actuarial report, the future claims liability has been assessed at an approximate value of $23,258,000 as at 30 June 2017.

Contingent Assets

The department does not have any contingent assets.



39. Events occurring after the end of the reporting period

The functions and staff, and the assets, liabilities and equity of the Department of Commerce were effectively amalgamated into the newly designated Department of Mines, Industry Regulation and Safety, and Department of Jobs, Tourism, Science and Innovation with effect on and from 1 July 2017. Consequently, this will be the final Annual Financial Statements for the Department of Commerce.

40. Explanatory statement

All variances between estimates (original budget) and actual results for 2017, and between the actual results for 2017 and 2016 are shown below. Narratives are provided for key variations selected from observed major variances, which are generally greater than:

• 5 per cent and $2.9 million for the Statements of Comprehensive Income and Cash Flows; and• 5 per cent and $5.6 million for the Statement of Financial Position.

Actual2017$’000

Original budget

2017$’000

Variance between

actual and budget

for 2017$’000

Variance note

Actual2017$’000

Actual2016$’000

Variance between

actual results

for 2017 and 2016

$’000Variance

noteStatement of Comprehensive IncomeCOST OF SERVICESExpenses

Employee benefits 85,057 90,553 (5,496) A 85,057 83,769 1,289Supplies and services 24,543 27,386 (2,843) B 24,543 24,216 326Depreciation and amortisation 4,100 4,419 (319) 4,100 4,271 (171)Finance costs 22 28 (6) 22 24 (3)Accommodation 8,902 8,918 (16) 8,902 10,683 (1,781)Grants and subsidies 18,391 19,193 (802) 18,391 16,621 1,770Revaluation decrements 117 - 117 117 - 117Impairment - - - - 123 (123)Other expenses 9,133 2,329 6,804 C 9,133 1,725 7,407 BA

Total cost of services 150,264 152,826 (2,562) 150,264 141,432 8,831IncomeRevenue

User charges and fees 61,480 75,019 (13,539) D 61,480 71,386 (9,906) BBSales 114 295 (181) 114 190 (76)Commonwealth grants and contributions 418 456 (38) 418 362 56Other revenue 6,158 5,349 809 6,158 6,326 (169)

Total revenue 68,170 81,119 (12,949) 68,170 78,264 (10,094)Gains

Other gains 11 - 11 11 146 (136)Total gains 11 - 11 11 146 (136)Total income other than income from State Government 68,180 81,119 (12,939) 68,180 78,411 (10,230)

NET COST OF SERVICES 82,083 71,707 10,376 82,083 63,022 19,062

Variance explanations commence on page 108.



Actual2017$’000

Original budget

2017$’000

Variance between

actual and budget

for 2017$’000

Variance note

Actual2017$’000

Actual2016$’000

Variance between

actual results

for 2017 and 2016

$’000Variance

note

Income from State GovernmentService appropriation 58,028 58,105 (77) 58,028 42,690 15,338 BCServices received free of charge 871 1,364 (493) 871 1,116 (246)Royalties for Regions Fund 9,867 10,444 (577) 9,867 10,138 (271)

Total income from State Government 68,766 69,913 (1,147) 68,766 53,944 14,822

SURPLUS/(DEFICIT) FOR THE PERIOD (13,317) (1,794) (11,523) (13,317) (9,078) (4,240)

OTHER COMPREHENSIVE INCOMEItems not reclassified subsequently to profit or loss

Changes in asset revaluation surplus (2,064) - (2,064) (2,064) 20 (2,083)Total other comprehensive income (2,064) - (2,064) (2,064) 20 (2,083)TOTAL COMPREHENSIVE INCOME FOR THE PERIOD (15,381) (1,794) (13,587) (15,381) (9,058) (6,323)




Actual2017$’000

Original budget

2017$’000

Variance between

actual and budget

for 2017$’000

Variance note

Actual2017$’000

Actual2016$’000

Variance between

actual results

for 2017 and 2016

$’000Variance

noteStatement of Financial PositionASSETSCurrent Assets

Cash and cash equivalents 7,663 16,601 (8,938) E 7,663 16,506 (8,844) BDRestricted cash and cash equivalents 189,827 167,748 22,079 F 189,827 190,822 (995)Receivables 5,032 7,714 (2,682) 5,032 10,762 (5,729) BEAmounts receivable for services 2,974 3,320 (346) 2,974 53 2,921Other current assets 1,655 363 1,292 1,655 741 914

Total Current Assets 207,151 195,746 11,405 207,151 218,884 (11,732)Non-Current Assets

Restricted cash and cash equivalents 285 - 285 285 - 285Receivables 9,657 7,380 2,277 9,657 10,024 (368)Amounts receivable for services 11,826 12,477 (651) 11,826 11,638 188Property, plant and equipment 41,455 46,641 (5,186) 41,455 44,644 (3,190)Intangible assets 10,319 17,717 (7,398) G 10,319 9,538 781

Total Non-Current Assets 73,541 84,215 (10,674) 73,541 75,844 (2,303)TOTAL ASSETS 280,692 279,961 731 280,692 294,728 (14,036)LIABILITIESCurrent Liabilities

Payables 4,888 5,868 (980) 4,888 4,488 400Unearned revenues 9,824 8,084 1,740 9,824 9,227 597Provisions 18,645 17,687 958 18,645 18,420 226Other current liabilities 367 88 279 367 341 26

Total Current Liabilities 33,724 31,727 1,997 33,724 32,476 1,249Non-Current Liabilities

Payables 500 - 500 500 589 (89)Unearned revenues 9,601 7,681 1,920 9,601 8,665 936Borrowings 771 771 - 771 771 -Provisions 3,641 3,751 (110) 3,641 3,675 (34)

Total Non-Current Liabilities 14,514 12,203 2,311 14,514 13,700 814TOTAL LIABILITIES 48,238 43,930 4,308 48,238 46,176 2,062NET ASSETS 232,455 236,031 (3,576) 232,455 248,552 (16,098)EQUITY

Contributed equity 77,639 77,639 - 77,639 78,356 (717)Reserves 8,972 11,016 (2,044) 8,972 11,036 (2,064)Accumulated surplus 145,843 147,376 (1,533) 145,843 159,161 (13,317)

TOTAL EQUITY 232,455 236,031 (3,576) 232,455 248,552 (16,098)




Actual2017$’000

Original budget

2017$’000

Variance between

actual and budget

for 2017$’000

Variance note

Actual2017$’000

Actual2016$’000

Variance between

actual results

for 2017 and 2016

$’000Variance

noteStatement of Cash FlowsCASH FLOWS FROM STATE GOVERNMENT

Service appropriation 54,806 53,946 860 54,806 38,960 15,846 BFHolding account drawdowns 113 53 60 113 2,800 (2,687)Royalties for Regions Fund 9,867 10,444 (577) 9,867 10,138 (271)Distribution to owners (717) - (717) (717) (597) (120)

Net cash provided by State Government 64,070 64,443 (373) 64,070 51,301 12,769CASH FLOWS FROM OPERATING ACTIVITIESPayments

Employee benefits (84,589) (90,769) 6,180 H (84,589) (86,880) 2,291Supplies and services (26,199) (28,659) 2,460 (26,199) (24,008) (2,191)Finance costs (22) (28) 6 (22) (24) 2Accommodation (8,903) (7,517) (1,386) (8,903) (10,035) 1,132Grants and subsidies (17,995) (19,493) 1,498 (17,995) (17,706) (289)GST payments on purchases (3,850) (2,570) (1,280) (3,850) (5,003) 1,153Other payments (1,733) (793) (940) (1,733) (1,719) (14)

ReceiptsUser charges and fees 61,568 73,882 (12,314) I 61,568 67,793 (6,225) BGSale of goods and services 1,916 456 1,460 1,916 190 1,726Commonwealth grants and contributions 318 - 318 318 362 (44)GST receipts on sales 354 670 (316) 354 499 (145)GST receipts from taxation authority 4,451 1,900 2,551 4,451 4,726 (275)Other receipts 6,348 6,150 198 6,348 6,866 (518)

Net cash provided by/(used in) operating activities (68,336) (66,771) (1,565) (68,336) (64,940) (3,397)

CASH FLOWS FROM INVESTING ACTIVITIESPayments

Purchase of non-current assets (5,288) (9,199) 3,911 J (5,288) (6,001) 713Receipts

Other receipts from investing activities - 717 (717) - - -Net cash provided by/(used in) investing activities (5,288) (8,482) 3,194 (5,288) (6,001) 713

CASH FLOWS FROM FINANCING ACTIVITIESPayments

Other repayments - (717) 717 - - -Net cash provided by/(used in) financing activities - (717) 717 - - -

Net increase in cash and cash equivalents (9,554) (11,527) 2,690 (9,554) (19,640) 10,085Cash and cash equivalents at the beginning of the period 207,328 195,876 11,452 207,328 226,968 (19,640)

CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 197,774 184,349 14,142 197,774 207,328 (9,555)




Explanations (Controlled Operations)Major Estimate (Original Budget) and Actual (2017) Variance Narratives for Controlled Operations

Statement of comprehensive income

A Employee benefits are under budget by $5.5 million due to reduced recruitment into vacant positions as a measure taken by the department to manage current and future Public Sector Workforce Renewal savings measures, and to also align with the decrease in revenue.

B Supplies and services are under budget by $2.8 million due to expenditure being generally constrained, in line with the lower than expected revenue.

C Other expenses are $6.8 million over budget, largely due to the reversal of prior year accrued revenue from the Rental Accommodation Account of $5.5 million, as the department forwent its recoup of the bonds administration costs in 2016–17 (refer to Note 11). The expensing of information systems development costs of $1.8 million also contributed to the increase (refer to Note 11).

D User charges and fees are $13.6 million under budget due to the department forgoing its recoup of the bonds administration costs in 2016–17, lower than expected income from the agent trust accounts held under the Real Estate and Settlement Agent Acts, and a decline in Building Commission and WorkSafe user charges and fees due to softening market conditions.

Statement of financial position

E Cash and cash equivalents are $8.90 million under budget due to a significant decrease in revenue for the year, without a comparable decrease in expenditure, which caused the cash balances to be drawn on during the year.

F Restricted cash and cash equivalents are $22.1 million over budget due to the increase of the property industry and building services account balances as outgoings from these restricted accounts were less than anticipated.

G Intangible assets are $7.4 million under budget due to the rescheduling of the purchase and acquisition of information and communication technology capital assets under the department’s Strategic Information Plan.

Statement of cash flows

H Employee benefits payments are $6.2 million under budget for the same reasons as those identified in note A.

I User fees and charges are $12.3 million under budget for the same reasons as those identified in note D.

J Purchase of non-current assets is $3.9 million under budget due to delays in Information Technology projects and Building Commission reform projects.

Major Actual (2017) and Comparative (2016) Variance Narratives for Controlled Items

Statement of comprehensive income

BA Other expenses have increased by $7.4 million, largely due to the reversal of prior year accrued revenue from the Rental Accommodation Account of $5.5 million, as the department forwent its recoup of the bonds administration costs in 2016–17 (refer to Note 11). The expensing of information systems development costs of $1.8 million also contributed to the increase (refer to Note 11).



BB User charges and fees have decreased by $9.9 million due to the department forgoing its recoup of the bonds administration costs in 2016–17, lower income from the agent trust accounts held under the Real Estate and Settlement Agent Acts, and a decline in Building Commission and WorkSafe user charges and fees due to softening market conditions.

BC Service appropriations have increased by $15.3 million as the department did not fully drawdown the appropriations in 2015–16, due to excess cash balances. However the full drawdown was made in 2016–17.

Statement of financial position

BD Cash and cash equivalents have decreased by $8.9 million for the same reasons as those identified in note E.

BE Receivables have decreased by $5.8 million as last year the department expected to recoup the bonds administration costs from the Rental Accommodation Account in 2016–17. However, to ensure the sustainability of the Rental Accommodation Account, the department forwent its recoup in 2016–17, and the department is not expecting to recoup the costs in 2017–18.

Statement of cash flows

BF Service appropriations have increased by $15.8 million for the same reasons as those identified in note BC.

BG User charges and fees have decreased by $6.2 million for the same reasons as those identified in note BB.

41. Remuneration of auditor2017$’000

2016$’000

Remuneration paid or payable to the Auditor General in respect of the audit for the current financial year is as follows:Auditing of financial statements, controls and key performance indicators 206 207

42. Related bodies

The department has no related bodies.

43. Affiliated bodiesWestern Australian Technology and Industry Advisory Council (TIAC).

The Technology and Industry Advisory Council (TIAC), which was established by the Technology Development Amendment Act 1987 and continued under the Industry and Technology Development Act 1998 (ITDA), was totally funded by the department.Western Australian Industry and Technology Development Account (a)Balance at the start of period 2,760 2,610Receipts 13,649 14,427Payments (14,335) (14,277)Balance at the end of the period 2,074 2,760

(a) Records funds received and expenditure charged in accordance with the ITDA.

The Western Australian Technology and Industry Advisory Council (TIAC) has transferred to the Department of Jobs, Tourism, Science and Innovation with effect on and from 1 July 2017.



44. Special purpose accounts and restricted cash accounts

2017$’000

2016$’000

SummarySpecial Purpose Accounts section 16 of Financial Management Act 2006

Consumer Credit Act (WA) 103 103Departmental Receipts in Suspense 22 80State Trading Concerns 1,131 1,053Motor Vehicle Repair (MVR) Industry Education and Research Account 132 115

Motor Vehicle Repair (MVR) Industry Compensation Account 120 106Co-operatives Companies Liquidation Account 12 12EnergySafety Account 12,061 11,239Real Estate - Education and General Purpose Account 25,332 28,428Real Estate - Fidelity Guarantee Account 45,578 44,742Real Estate - Home Buyers Assistance Account 15,235 16,426Real Estate and Business Agents Supervisory Board Trust Account 362 354Settlement Agents - Education and General Purpose Account 26,685 25,912Settlement Agents - Fidelity Guarantee Account 45,790 43,800Building Services Trust Dispute Remedies - 42Building Services Account 15,165 15,522

187,729 187,934

Restricted Cash AccountsIndian Ocean Territories - Commonwealth Government 37 107Royalties for Regions 2,061 2,781

2,098 2,888




2017$’000

2016$’000

Detailed BreakdownSpecial Purpose AccountsConsumer Credit Act (WA)Holds funds pending distribution in accordance with the Consumer Credit (WA) Act 1996 or court direction.

Balance at the start of period 103 103Receipts - -Payments - -Balance at the end of period 103 103

Departmental Receipts in SuspenseHolds funds pending identification of the purpose for which the monies were received.

Balance at the start of period 80 157Receipts 9 100Payments (67) (177)Balance at the end of period 22 80

State Trading ConcernsThe fund was created under the State Trading Concerns Act 1916 and controls income received in respect of the provisions of copyright materials and relevant trade mark advertising opportunities or similar arrangements.

Balance at the start of period 1,053 899Receipts 105 176Payments (27) (22)Balance at the end of period 1,131 1,053

MVR Industry Education and Research AccountHolds funds used for the Motor Vehicle Repairers Industry in accordance with the Motor Vehicle Repairers Act 2003.


MVR Industry Compensation AccountHolds funds used for the Motor Vehicle Repairers Industry in accordance with the Motor Vehicle Repairers Act 2003.


Co-operatives Companies Liquidation AccountHolds unclaimed funds pending redistribution in accordance with the Companies (Co-operative) Act 1943 section 290(1).

Balance at the start of period 12 12Receipts - -Payments - -Balance at the end of period 12 12











2017$’000

2016$’000

EnergySafety AccountHolds funds used for the provision of functions and services in accordance with the Energy Safety Act 2006.

Balance at the start of period 11,239 11,417Receipts 15,476 14,909Payments (14,653) (15,087)Balance at the end of period 12,061 11,239

Real Estate - Education and General Purpose AccountHolds funds used for the operation of the Education and General Purpose Account in accordance with the Real Estate and Business Agents Act 1978.


Real Estate - Fidelity Guarantee AccountHolds funds used for the operation of the Fidelity Guarantee Account in accordance with the Real Estate and Business Agents Act 1978.

Balance at the start of period 44,742 44,025Receipts 1,401 1,593Payments (564) (875)Balance at the end of period 45,578 44,742

Real Estate - Home Buyers Assistance AccountHolds funds used for the operation of the Home Buyers Assistance Account in accordance with the Real Estate and Business Agents Act 1978.


Real Estate and Business Agents Supervisory Board Trust AccountHolds funds as a result of legal proceedings and liquidations of agencies in accordance with the Trust Statement.

Balance at the start of period 354 257Receipts 8 100Payments - (2)Balance at the end of period 362 354

Settlement Agents - Education and General Purpose AccountHolds funds used for the operation of the Education and General Purpose Account in accordance with the Settlement Agents Act 1981.

Balance at the start of period 25,912 24,920Receipts 1,735 2,105Payments (962) (1,113)Balance at the end of period 26,685 25,912










2017$’000

2016$’000

Settlement Agents - Fidelity Guarantee AccountHolds funds used for the operation of the Fidelity Guarantee Account in accordance with the Settlement Agents Act 1981.

Balance at the start of period 43,800 41,468Receipts 1,990 2,336Payments - (4)Balance at the end of period 45,790 43,800

Building Services Trust Dispute Remedies AccountHolds money in trust in connection with orders made by the Building Commission and State Administrative Tribunal under the Building Services (Complaint Resolution and Administration) Act 2011.

Balance at the start of period 42 -Receipts - 42Payments (42) -Balance at the end of period - 42

Building Services AccountHolds funds used for the provision of functions and services in accordance with building services acts.


Restricted Cash AccountsIndian Ocean TerritoriesThe Department of Commerce has a service delivery agreement with the Commonwealth Government to undertake to provide its normal service to the Christmas and Cocos Islands.

Balance at the start of period 107 - Receipts 206 351Payments (276) (244)Balance at the end of period 37 107

Royalties for RegionsThis is a sub-fund within the over-arching ‘Royalties for Regions Fund’. The recurrent funds are committed to projects and programs in WA regional areas.






45. Supplementary financial information2017$’000

2016$’000

Write-Offs

During the financial year ending 30 June 2017, $95,984.50 (2016: $114,325.38) of debts due to the State were written off. These related mainly to individual regulatory fee transactions considered uneconomic to pursue further and payments to former staff (salary and superannuation). The amounts were written off under the authority of:

The Accountable Authority 96 114

Losses through Theft, Defaults and Other CausesLosses of public moneys and, public and other property through theft or default. 1 -

Amounts recovered. 1 -Gifts of Public Property

The department did not provide gifts of public property. - -Acts of Grace

The department made no act of grace payments. - -

46. Disclosure of administered income and expensesExpenses

Supplies and services 2,770 8,416Grants and subsidies 3,293 4,091Receipts paid into consolidated account 480 2,003Other expenses 28,397 12,721

Total administered expenses 34,940 27,231Revenue

User charges and fees 221 174Interest revenue 7,836 8,995Other revenue 30,192 28,979Appropriation 2,000 9,945

Total administered revenue 40,249 48,093

The administered income and expenses are those which the Government requires the department to administer on its behalf.



47. Disclosure of administered income and expenses by service

Consumer Protection

Industry and Technology Energy Safety Building

Commission Total

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000

2017$’000

2016$’000


Supplies and services 2,770 8,416 - - - - - - 2,770 8,416Grants and subsidies 3,293 4,091 - - - - - - 3,293 4,091Receipts paid into consolidated account 261 1,785 98 141 63 57 58 21 480 2,003

Other expenses 58 23 - - - - 28,339 12,698 28,397 12,721Total administered expenses 6,382 14,315 98 141 63 57 28,397 12,719 34,940 27,231Income

User charges and fees 98 96 - - 63 57 60 21 221 174Interest 7,738 8,855 98 141 - - - - 7,836 8,995Other revenue 5,690 1,675 327 390 - - 24,175 26,914 30,192 28,979Service appropriation - - - - - - 2,000 9,945 2,000 9,945

Total administered income 13,525 10,626 425 530 63 57 26,235 36,880 40,249 48,093



48. Explanatory statement for Administered Items

All variances between estimates (original budget) and actual results for 2017, and between the actual results for 2017 and 2016 are shown below. Narratives are provided for key variations selected from observed major variances, which are generally greater than:

• 5 per cent and $0.8 million for the Statement of Comprehensive Income.

Actual 2017 $’000

Original budget

2017 $’000

Variance between

actual and

budget for 2017

$’000Variance

note

Actual 2017 $’000

Actual 2016 $’000

Variance between

actual results

for 2017 and 2016

$’000Variance

noteDisclosure of administered expenses and incomeExpenses

Supplies and services 2,770 6,059 (3,289) A 2,770 8,416 (5,645) FGrants and subsidies 3,293 3,010 283 3,293 4,091 (798) GReceipts paid into consolidated account 480 408 72 480 2,003 (1,523) HOther expenses 28,397 18,459 9,938 B 28,397 12,721 15,676 I

Total administered expenses 34,940 27,936 7,004 34,940 27,231 7,709Income

User charges and fees 221 250 (29) 221 174 47Interest revenue 7,836 7,123 713 C 7,836 8,995 (1,160) JOther revenue 30,192 23,478 6,714 D 30,192 28,979 1,213 KAppropriation 2,000 7,644 (5,644) E 2,000 9,945 (7,945) L

Total administered income 40,249 38,495 1,754 40,249 48,093 (7,844)NET INCOME FROM ADMINISTERED ITEMS 5,308 10,559 (5,251) 5,308 20,862 (15,553)

Explanations (Administered Operations)Major Estimate (Original Budget) and Actual ( 2017) Variance Narratives for Administered Items

Statement of comprehensive incomeA Supplies and services are $3.3 million under budget, mainly due to the bonds administration costs

from the Rental Accommodation Account not being reimbursed as budgeted.

B Other expenses are $9.9 million over budget due to the higher than expected Home Indemnity Insurance (HII) claims costs, which resulted from a number of building company failures during the year.

C Interest revenue is $0.7 million over budget due to an improvement in interest rates towards the end of 2016–17, which was not reflected in the budget.

D Other revenue is $6.7 million over budget mainly due to the reversal of prior year accrued expense for the reimbursement of bond administration costs from the Rental Accommodation Account of $5.5 million, which was forgone in 2016–17 (refer to Note 11) and HII premium revenue being higher than the budget.

E Appropriation is $5.6 million under budget as it was anticipated that the HII Reinsurance Account would require appropriations to offset the projected shortfall in the special purpose account. However, this was not required as the receipts for the year exceeded the payments.



Major Actual (2017) and Comparative (2016) Variance Narratives for Administered Items

Statement of comprehensive incomeF Supplies and services have decreased by $5.6 million for the same reason as identified in note A.

G Grants and subsidies have decreased by $0.8 million as the Tenancy Advice and Education Services grants contracts were renegotiated to provide for lower grant payments from 2016–17.

H Receipts paid into consolidated account have decreased by $1.5 million due to a one-off payment from the Commonwealth in 2015–16 which was non-retained, and related to residual funds which arose following the deregulation of the travel agent’s industry.

I Other expenses have increased by $15.7 million for the same reason as identified in note B.

J Interest revenue has decreased by $1.2 million due to lower interest rates in 2016–17 as compared to prior year.

K Other revenue has increased by $1.2 million due to the reimbursement of bond administration costs from the Rental Accommodation Account being foregone for 2016–17, offset by a decrease in HII premium revenue and a one-off payment from the Commonwealth received in 2015–16, relating to residual funds which arose following the deregulation of the travel agent’s industry.

L Appropriation has decreased by $7.9 million as the only administered appropriation received for 2016–17 related to a Cabinet decision to make an ex gratia payment for subsidence in two Mullaloo properties. In prior year, appropriations were received to offset the expected shortfall in the balance of the Home Indemnity Insurance Reassurance Account.

49. Disclosure of administered assets and liabilities2017$’000

2016$’000

ASSETSCurrent Assets

Cash and cash equivalents 866 156Restricted cash and cash equivalents 387,628 390,068Receivables 5,232 5,078

Total Administered Current Assets 393,726 395,302Non-Current Assets

Receivables 10,583 11,377Total Administered Non-Current Assets 10,583 11,377TOTAL ADMINISTERED ASSETS 404,309 406,678

LIABILITIESCurrent Liabilities

Payables 4,866 9,367Other current liabilities 392,162 394,278

Total Administered Current Liabilities 397,028 403,645TOTAL ADMINISTERED LIABILITIES 397,028 403,645

The administered assets and liabilities are those which the Government requires the department to administer on its behalf.



2017$’000

2016$’000

SummarySpecial Purpose Accounts section 16 of Financial Management Act 2006 (Administered)Rental Accommodation Account 372,745 379,549Home Indemnity Insurance (HII) Reinsurance Account 14,879 10,518

387,625 390,066Restricted Cash AccountHome Indemnity Insurance (HII) Reinsurance Account - -

- -

Detailed BreakdownSpecial Purpose Account (Administered)Rental Accommodation AccountHolds rental security bonds and the interest income in accordance with clause 3(1) of schedule 1 of the Residential Tenancies Act 1987.Balance at start of period 379,549 379,634Receipts:Bonds received 162,271 168,359Interest received 7,869 8,749Other (32) 43Total receipts 170,108 177,152Payments:Bonds disbursed (170,642) (170,441)Administration costs (2,760) (2,934)Grants (3,293) (4,091)Other (216) 229Total Payments (176,911) (177,237)Balance at the end of period 372,745 379,549Home Indemnity Insurance (HII) Reinsurance AccountHolds the net premiums paid to the State by the insurers for reinsurance under the HII arrangements.Balance at the start of period 10,518 -Receipts 28,564 48,951Payments (24,202) (38,433)Balance at the end of period 14,879 10,518

Restricted Cash Account (Administered)Home Indemnity Insurance (HII) Reinsurance AccountHolds the net premiums paid to the State by the insurers for reinsurance under the HII arrangements.Balance at the start of period - 10,229 Receipts - - Payments - (10,229)Balance at the end of period - -

During 2015–16 a Special Purpose Account (SPA) for the HII funds was created and the funds were transferred and reported against the SPA in 2015–16.




Key Performance Indicators

Certification of Key Performance Indicators

I hereby certify that the key performance indicators are based on proper records, are relevant and appropriate for assisting users to assess the Department of Commerce’s performance, and fairly represent the performance of the Department of Commerce for the financial year ended 30 June 2017.

Lex McCulloch Reporting Officer 12 September 2017

Outcome Based Management (OBM) Framework

The Department of Commerce’s Outcome Based Management (OBM) structure was revised during 2016–17. Changes to the OBM were implemented as part of the 2016–17 Budget Papers process and further amendments were implemented during the year for 2016–17 reporting. These amendments related to the definitions and related efficiency indicators for Service 2: Targeted Industry Development and Service 6: Building Commission. Additionally, the methodology used to determine the WorkSafe efficiency indicator Average cost per inspection or investigation was revised to more accurately reflect the costing of this indicator.

Key effectiveness indicators

There are seven key effectiveness indicators adopted by the department, which measure the extent to which its six outcomes are achieved.

Key efficiency indicators

Efficiency performance indicators have been formulated for each of the department’s six service areas: Consumer Protection; Targeted Industry Development; Energy Safety; Labour Relations; WorkSafe; and Building Commission. Each service area is supported by a number of programs, which in turn are comprised of various underpinning activities carried out within the department.

All efficiency indicators illustrate the average cost per program. They reflect the cost, including overheads, of conducting the department’s operational activities. The amount of the department’s expenditure attributed to the provision of each program is calculated based on the amount of estimated staff time allocated to undertaking the activities (projects and tasks) associated with that program. The total cost of the program is then divided by the quantity of activities achieved. These indicators exclude grants paid to external parties, costs associated with the implementation of the Agency Expenditure Review (AER) and the cost of non-operational activities.


Key Performance Indicators

The linkage of the department’s desired outcomes and services to the community and the Government Goals is demonstrated in Table 7:

Table 7: Relationship to the Government’s goals for 2016–17

Government GoalsAgency Level Desired Outcomes Services

Results-Based Service Delivery: Greater focus on achieving results in key service delivery areas for the benefit of all Western Australians.

Outcome 1: A fair trading environment that protects consumers and traders in Western Australia.

Service 1: Consumer Protection The provision of consumer protection advice, information, education and business regulation services to the Western Australian community.

Outcome 3: Community in which the use of electricity and gas is regulated and safe.

Service 3: Energy Safety The provision of regulatory services to the Western Australian community through licensing and compliance activities in the area of energy safety.

Financial and Economic Responsibility: Responsibly managing the State’s finances through the efficient and effective delivery of services, encouraging economic activity and reducing regulatory burdens on the private sector.

Outcome 2: Western Australian industry is competitive in targeted priority and emerging sectors.

Service 2: Targeted Industry Development Contributes to the State’s economy by supporting industry development. Services include:

• supporting industry development through research and infrastructure;

• supporting Western Australian industry competitiveness, capacity and capabilities and access to market opportunities; and

• providing policy development advice.Outcome 6: Buildings and plumbing installations that are safe, sustainable and respond to community needs.

Service 6: Building Commission The provision of government administration, licensing, regulatory and dispute resolution services that enable the building and plumbing industries to efficiently deliver building and plumbing installations that are safe, sustainable and respond to community needs.

Social and Environmental Responsibility: Ensuring that economic activity is managed in a socially and environmentally responsible manner for the long-term benefit of the State.

Outcome 4: Shape and influence industrial relations systems in Western Australia.

Service 4: Labour Relations To assist private and public sector workplaces to be economically sustainable and fair by providing our stakeholders and clients with expert labour relations advice, education and regulation.

Outcome 5: A workplace operated in a safe and healthy manner.

Service 5: WorkSafe The provision of advice, information, education, licensing and enforcement services to the Western Australian community in the area of occupational safety and health.


Outcome one

A fair trading environment that protects consumers and traders in Western Australia.

Key effectiveness indicator 1The extent to which traders comply with regulatory requirements

Table 8: Key effectiveness indicator 1

Measure2012–13

Actual2013–14

Actual2014–15

Actual2015–16

Actual2016–17

Actual2016–17 Target(1)

Number of inspections 28,751 22,981 31,648 33,577 34,859

Number compliant 27,851 22,193 30,261 32,028 33,072

Result 97% 97% 96% 95% 95% 95%

Note:(1) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers and is

the percentage of total compliance over total inspections.

The department’s effectiveness in relation to the extent to which consumers are protected and businesses operate fairly is assessed in terms of the proportion of traders that comply with regulatory requirements. The extent to which breaches of a significant nature were identified is the basis for monitoring and reporting compliance. The extent of compliance is ascertained by assessing businesses against criteria established by the department, in particular priority areas regarding compliance with consumer protection legislation. During the course of inspections, inspectors verify traders’ compliance against a list of regulatory requirements. Only those areas for which the Consumer Protection Division is directly responsible are used to ascertain the extent of compliance within the community. During 2016–17, 34,859 consumer protection routine and proactive inspections, as compared to 33,577 in 2015–16, were undertaken to provide the result reported.

Of these inspections, 95 per cent of traders were found to be compliant with the regulatory requirements, which is equal to the 2015–16 results and achieved the 2016–17 target set of 95 per cent.


Service 1: Consumer Protection

The provision of consumer protection advice, information, education and business regulation services to the Western Australian community.

Table 9: Key efficiency indicators 1.1–1.4

Indicators2014–15 Actual(1)

2015–16 Actual(1)

2016–17 Actual

2016–17 Target(2)

1.1 Average cost per client contact to provide information and advice $2.38 $1.62 $1.46 $1.49

1.2 Average cost per policy project $173,801 $244,789 $151,197 $308,783

1.3 Average cost per inspection or investigation $387.71 $365.47 $331.24 $512.75

1.4 Average cost per registration or licence $14.64 $11.88 $11.47 $11.15

Notes:(1) The 2014–15 and 2015–16 results shown are as published in the department’s 2015–16 Annual Report.(2) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

Key efficiency indicator 1.1 - Average cost per client contact to provide information and adviceThe Consumer Protection Division responds to enquiries from members of the public and provides them with customised information or education. A key element of the department’s role is also to provide more tailored advice and assistance to the community in relation to specific matters, typically on a one-to-one basis and of a short duration. The response can be a result of telephone, front counter, email or letter enquiry.

The division delivers non-customised and mass-produced services that provide members of the public with information and raises awareness within the community. Many of these activities are automated and include online visitors to the department’s websites (including FuelWatch and ScamNet) and the delivery of mass-produced services, including publication distribution and visitor attendance at shows, expos or seminars.

Through the Consumer Protection Service, the department undertook 11,751,733 activities in 2016–17 to provide information and advice services, which is more than both the 10,739,916 (9 per cent) undertaken in 2015–16 and the estimated 10,658,611 (10 per cent). This is due to an increase in client contacts via ScamNet and Scamquery emails; advice line calls regarding residential tenancy bonds; contacts at shows and expos and an increase in calls to the Associations advice line due to the implementation of new associations’ legislation during the reporting period. As a result, the average cost per unit to provide information and advice was $1.46, which is less than the 2015–16 figure of $1.62 (10 per cent) and the 2016–17 target of $1.49 (2 per cent).


Key efficiency indicator 1.2 - Average cost per policy projectMajor policy projects are aimed at enhancing the regulatory environment and usually involve significant duration, complexity and public consultation. Major policy projects include Cabinet submissions to print a new Bill; the introduction of new mandatory codes; amendments to an existing Act or mandatory code to implement a government policy change that requires consultation with parties external to the agency; or new government policy that requires extensive consultation with parties external to the agency. Other policy projects of notable duration, moderate complexity and aimed at enhancing the regulatory environment or developing a new policy position are also included. These policy projects produce new or amended subsidiary legislation (such as a regulation or order); voluntary codes, guidance notes or equivalent; briefing notes or policy submissions to a Minister or other external bodies; Cabinet submissions; or new or significant amendments to government policy.

Through the Consumer Protection Service, the department undertook 26 policy projects, which was significantly higher than the anticipated target of 12 (117 per cent) and the 16 undertaken in 2015–16 (63 per cent). This was due to an unexpected increase in minor legislative and other policy projects (for example, the implementation of multiple sets of individual amendment regulations in support of red tape amendments passed by the Parliament in November 2016; the implementation of product safety standards; and appointments to committees) resulting in an unusually low unit cost in 2016–17 of $151,197. Although the 2016–17 average cost per policy project is significantly less (51 per cent) than the target of $308,783, this target was set with the anticipation of a higher unit cost during 2016–17, as the capacity to conclude policy projects was projected to be limited by available parliamentary sitting time due to the 2017 State election.

Key efficiency indicator 1.3 - Average cost per inspection or investigationUndertaking inspections and audits is an important role of the Consumer Protection Division. These inspections and audits compare a current state or situation to acceptable standards, measures or practices. Compliance inspections and audit reports assess a trader’s level of compliance with a set standard and usually involve a one-to-one transaction, such as an inspector undertaking an assessment regarding a trader meeting specified criteria.

A key element of the department’s regulatory enforcement regime is investigations and compliance. Departmental employees determine if a breach of the law has occurred or is occurring, investigate to determine if legal action is warranted or whether education is a preferred means of achieving compliance.

Prosecutions, legal actions and proceedings are undertaken in response to the department’s determination that a breach of the law has occurred and there is a broader public interest in commencing legal proceedings. Actions include prosecutions seeking the imposition of penalties; court action seeking injunctions; the development and progression of matters for adjudication; and the implementation of outcomes such as sanctions.

Through the Consumer Protection Service, the department conducted 37,651 inspections or investigations in 2016–17, which was slightly more (5 per cent) than the 35,956 undertaken in 2015–16, but significantly higher (52 per cent) than the anticipated 24,766. This increase is attributed to an escalation in compliance inspections in response to issues identified over and above the standard inspection program Consumer Protection had in place; the additional inspections targeted emerging areas such as fidget spinners, growing beads and button batteries. The average cost per inspection or investigation of $331.24 in 2016–17 is less (9 per cent) than the 2015–16 result of $365.47, and significantly less (35 per cent) than the target of $512.75, due to the increase in the number of inspections or investigations during the reporting period.


Key efficiency indicator 1.4 - Average cost per registration or licenceAs required under the laws administered by the department, the Consumer Protection Division has maintained public registers that record specific information regarding incorporated associations, tenancy bonds, cooperative companies, limited partnerships and fuel price changes from retailers. The division administers and processes applications, which authorise individuals or traders for certain occupations or purposes. Generally, the process of administering an occupational licence involves the customer being provided with a licence, being issued with a renewed licence, or having their licence cancelled or details updated.

Through the Consumer Protection Service during 2016–17, there were 879,125 registrations and licences administered, which was slightly more than last year’s figure of 819,088 (7 per cent) and comparable to the anticipated 868,416. The average cost per registration or licence of $11.47 in 2016–17 was comparable to both the 2015–16 result of $11.88 (3 per cent) and the target of $11.15 (3 per cent).


Outcome two

Western Australian industry is competitive in targeted priority and emerging sectors.Key effectiveness indicator 2The extent to which clients and key stakeholders consider that the division’s services contribute to innovative industry developmentTable 10: Key effectiveness indicator 2

Measure2013–14 Actual(1)

2014–15 Actual

2015–16 Actual

2016–17 Actual

2016–17 Target(2)

Extent to which clients and key stakeholders consider that the division’s services contribute to innovative industry development.

88% 92% 88% 96% 75%

Notes:(1) Following the transfer of responsibility of science functions to the Department of the Premier and Cabinet, a review

of the outcome and effectiveness indicator was undertaken as part of the 2013–14 Budget Statement process. This outcome and effectiveness indicator were introduced to provide a stronger industry focus as innovative industry development is seen as a key indicator that Western Australian industry is remaining competitive.

(2) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

Since the Department’s Labour Relations and Industry Development Division’s Industry Development Directorate (IDD) is not able to independently measure the extent of innovative industry development in Western Australia on a macro level, the directorate sought the opinion of its clients and key stakeholders on whether IDD’s services contribute to innovative industry. Clients and key stakeholders include, but are not limited to, individual businesses, industry associations, local governments and tertiary institutions. If their views are positive, then the directorate can be confident that its services are contributing to Western Australian industry remaining competitive.

During 2016–17, respondents were from a variety of organisations including associations and peak bodies, businesses, state and local governments, and universities and or research organisations. Stakeholders were surveyed both at the time of service delivery, such as after acceptance of Industry Facilitation and Support Program grant funding, or via an online survey for regional telecommunications project events and large scale defence industry briefings.

The survey was completed to a confidence level of 95 per cent with a margin of error of ±3.5 per cent. Surveys were issued to 365 stakeholders in total, of which 51 were undeliverable and 119 completed and returned, representing an overall response rate of 38 per cent. The 2016–17 satisfaction result was 96 per cent, which was 8 per cent higher than the 2015–16 year’s result of 88 per cent, and 21 per cent higher than the target of 75 per cent. The 2016–17 target figure was set early in 2016 and the basis for setting the target at 75 per cent was that lower staff levels would result in lower satisfaction levels of IDD’s clients and key stakeholders. Whilst staff levels were reduced, new operating models evolved, including a push within the defence sector on a national level, leading to higher than anticipated satisfaction levels.


Service 2: Targeted Industry Development

Contributes to the State’s economy by supporting industry development. Services include:• supporting industry development through research and infrastructure;

• supporting Western Australian industry competitiveness, capacity and capabilities and access to market opportunities; and

• providing policy development advice.

Key efficiency indicator 2 - Average cost per industry development project supportedThis indicator was revised during 2016–17 from ‘Average cost per industry and technology project managed’ to ‘Average cost per industry development project supported’. IDD reviewed both its Service and related Key Efficiency Indicator to more accurately reflect the activities undertaken, with the emphasis of ‘supporting industry development’ rather than ‘promoting industry and technology’.

This indicator illustrates the average cost per project supported. The types of industry development projects for this indicator include projects in: Commercialisation Programs; Policy Development; Marine and Defence; Telecommunications; Technology Parks; and Local Industry Participation.

Table 11: Key efficiency indicator 2

Indicator2015–16 Actual(1)

2016–17 Actual(2)

2016–17 Target(3)

Average cost per industry development project supported $246,296 $278,566 $258,029

Notes:(1) The 2015–16 result shown as published in the department’s 2015–16 Annual Report was based on the previous indicator of

‘Average cost per industry and technology project managed’ and include 4 innovation projects.(2) In 2016–17, this indicator was refined from ‘Average cost per industry and technology project managed’ to ‘Average cost per

industry development project supported’ and there were no innovation projects included.(3) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

During 2016–17, 24 projects were managed, which is less (17 per cent) than the 29 managed in 2015–16, and the 29 expected. The target was, however, set prior to the knowledge that the innovation program was being transferred to the Department of Finance’s Office of the Government Chief Information Officer, which occurred from 25 May 2016. The average cost per industry development project supported in 2016–17 of $278,566 is more (13 per cent) than the 2015–16 result of $246,296 and also the target of $258,029 (8 per cent) due to the decrease in the number of projects managed during the reporting period.


Outcome three

Community in which the use of electricity and gas is regulated and safe.Key effectiveness indicators3.1 The number of electricity-related serious injuries and fatalities per million population

3.2 The number of gas-related serious injuries and fatalities per million population

Table 12: Key effectiveness indicators 3.1 and 3.2

Measures2014–15 Actual(1)

2015–16 Actual(1)

2016–17 Actual

2016–17 Target(8)

The number of electricity-related serious injuries and fatalities per million population 7.32(2) 3.05(4) 6.60(6) Nil

The number of gas-related serious injuries and fatalities per million population 9.63(3) 4.57(5) 4.27(7) Nil

Notes:(1) The 2014–15 and 2015–16 results shown are as published in the department’s 2015–16 Annual Report.(2) In 2014–15 there were 19 serious electrical accidents which included 12 incidents of hospitalisation, 5 incidents with

medical treatment and 2 fatalities.(3) In 2014–15 there were 25 serious gas accidents which included 12 incidents of hospitalisation, 12 incidents with medical

treatment and 1 fatality.(4) In 2015–16 there were 8 serious electrical accidents which included 3 incidents of hospitalisation, 4 incidents with medical

treatment and 1 fatality.(5) In 2015–16 there were 12 serious gas accidents which included 12 incidents with medical treatment only.(6) In 2016–17 there were 17 serious electrical accidents which included 5 incidents of hospitalisation, 12 incidents with

medical treatment and no fatalities.(7) In 2016–17 there were 11 serious gas accidents which included 3 incidents of hospitalisation, 7 incidents with medical

treatment and 1 fatality.(8) The targets are derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

Two effectiveness indicators measure this outcome, with the targets being set at zero as the desired outcome is to have no serious injuries and fatalities in both the electricity and gas energy areas.

The first is the number of electricity-related serious injuries and fatalities per million population, which measures how effective the electricity-related regulatory regime is, and subsequently the safety of the community. This indicator provides information regarding this department’s effectiveness concerning the achievement of a community in which the use of electricity is regulated and safe. This indicator provides meaningful performance information as the primary purpose of the legislation administered by the EnergySafety Division is to reduce or eliminate such incidents. The number of reported electricity related serious accidents tends to vary between 10 and 20 per year. During 2016–17, there were 17 reported serious electrical accidents which is within this range. The increase from the 2015–16 actual figure is primarily in the number of reported serious electrical accidents requiring medical treatment which increased from 4 in 2015–16 to 12 in 2016–17.

The second measure, the number of gas-related serious injuries and fatalities per million population, measures how effective the gas-related regulatory regime is, and subsequently the safety of the community. This indicator provides information regarding this department’s effectiveness concerning the achievement of a community in which the use of gas is regulated and safe. During 2016–17 there were 11 serious gas incidents, equating to a 2016–17 actual result of 4.27 for this indicator, which is comparable to the 2015–16 actual of 4.57.


Service 3: Energy Safety

The provision of regulatory services to the Western Australian community through licensing and compliance activities in the area of energy safety.

This service and related efficiency indicators were introduced as part of the 2015–16 Budget Papers process. Prior to this the EnergySafety Division contributed to a combined service with Labour Relations, WorkSafe and Building Commission Divisions.

Table 13: Key efficiency indicators 3.1 and 3.2


2015–16 Actual(1)

2016–17 Actual

2016–17 Target(8)

Average Cost of regulatory services $4,251(2) $3,887(3) $2,059(4) $6,326

Average Cost of provision of licensing services $32.68(5) $30.30(6) $32.10(7) $32.40

Notes:(1) The 2014–15 and 2015–16 results shown are as published in the department’s 2015–16 Annual Report.(2) Result consists of 245 Electricity and 638 Gas inspections, and 687 Electricity and 1,058 Gas investigations. Total of

2,628 inspections and investigations.(3) Result consists of 1,328 Electricity and 419 Gas inspections, and 318 Electricity and 975 Gas investigations. Total of

3,040 inspections and investigations.(4) Consists of 4,236 Electricity and 456 Gas inspections, and 298 Electricity and 1,064 Gas investigations. Total of

6,054 inspections and investigations as at 30 June 2017.(5) This includes 52,791 electrical-based licences and 9,068 gas-based licences. Total of 61,859 licences administered as at

30 June 2015.(6) This includes 55,057 electrical-based licences and 9,278 gas-based licences. Total of 64,335 licences administered as at

30 June 2016.(7) This includes 54,219 electrical-based licences and 9,450 gas-based licences. Total of 63,669 licences administered as at

30 June 2017.(8) The targets are derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

Key efficiency indicators 3.1- Average cost of regulatory servicesRegulatory services include investigations and compliance inspections. Investigations are a systematic enquiry to determine compliance or a breach, and may result in a decision ranging from taking no further action to the pursuit of legal action. Compliance inspections are inspections that are not undertaken in relation to any ongoing investigation and may result in a decision ranging from taking no further action to the pursuit of legal action. Inspections and investigations ensure compliance with legislative requirements to provide a safe environment for workers and the public.

Through the Energy Safety Service, the department conducted 6,054 inspections or investigations during 2016–17, which was significantly more than both last year’s figure of 3,040 and the anticipated 2,000. The increase in the number of compliance inspections can be attributed to a combination of elements including EnergySafety engaging additional temporary inspectors to carry out remote inspections and that the rearrangement of metropolitan work programs led to an increase in inspections related to residual current device (RCD) compliance and electrical contractor advertising. This increase in inspection numbers led to the average cost of regulatory services in 2016–17 of $2,059 being significantly less than both the 2015–16 result of $3,887 (47 per cent) and the target of $6,326 (67 per cent).


Key efficiency indicators 3.2 - Average cost of provision of licensing serviceLicensing services are transactions related to electricity and gas licences, but may include involvement of a regulatory board and follow up by technical staff to ensure that the pre-requisites to issue a licence are met. Transactions can be in person, by written correspondence or online, and require the processing of forms, checking of documentation for accuracy, and maintaining or updating of the licence database. Licensing services also include, but are not limited to, amendments to licence categories, replacing or adding nominees, renewals and restoration of licences. The number of licences administered is the total number of licences at the end of the financial year.

Through the Energy Safety Service the department administered 63,669 registrations and licences in 2016–17, which is comparable to both last year’s figure of 64,335 and the anticipated 63,730. The average cost of provision of licensing service of $32.10 in 2016–17 is comparable to both the 2015–16 result of $30.30 and the target of $32.40.


Outcome four

Shape and influence industrial relations systems in Western Australia.

Key effectiveness indicator 4The extent to which employers comply with the requirements of labour relations laws


Measure2012–13

Actual2013–14

Actual2014–15

Actual2015–16

Actual2016–17


The extent to which employers comply with the requirements of labour relations laws

No. elements 467 271 355 311 381

No. compliant 303 182 234 181 198

Result 65% 67% 66% 58% 52% 75%

Note:(1) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

This measure relates to the department’s effectiveness regarding the extent to which employers comply with the requirements of State industrial laws, which is assessed in terms of the degree to which workplaces meet set criteria for labour relations priority areas. The five key elements assessed are: payment of appropriate ordinary time rates of pay; providing employees with annual leave and sick leave entitlements; recording start and finishing times; recording total hours worked; and recording employment under correct status. During 2016–17, the department reviewed 109 employers’ time and wage records against all or part of the five key elements during the formal investigation phase.

A total of 381 elements were assessed, with 198 (52 per cent) being found to be compliant. The variation of 23 per cent between the 2016–17 result of 52 per cent and the target of 75 per cent is predominately due to the Division delaying implementation of its proactive inspection program, particularly due to the high number of complaints lodged during the reporting period. Consequently, data for this indicator has been based on employers who have had complaints made against them and are therefore more likely to have breached industrial laws.


Service 4: Labour Relations

To assist private and public sector workplaces to be economically sustainable and fair by providing our stakeholders and clients with expert labour relations advice, education and regulation.

This service and related efficiency indicators were implemented as part of the 2015–16 Budget Papers process. Prior to this the Labour Relations Division contributed to a combined service with EnergySafety, WorkSafe and Building Commission divisions.

Table 15: Key efficiency indicators 4.1, 4.2 and 4.3


2015–16 Actual(1)

2016–17 Actual

2016–17 Target(2)

4.1 Average cost per hour of policy advice $167.16 $177.63 $254.11 $179.82

4.2 Average cost per client contact to provide information and advice $2.59 $2.70 $2.61 $2.76

4.3 Average cost per inspection or investigation $8,216 $7,524 $9,124 $5,982

Notes:(1) The 2014–15 and 2015–16 results shown are as published in the department’s 2015–16 Annual Report.(2) The targets are derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

Key efficiency indicator 4.1 - Average cost per hour of policy adviceThis indicator reflects the policy, legal and legislative advice provided to government and other stakeholders through the Labour Relations Service. It includes the research, preparation and delivery of policy advice and support to the Minister; submissions on behalf of the Minister and Government at tribunals, inquiries or reviews; legislative and regulatory amendments; and statutory appointments and proclamations.

Through the Labour Relations Service, the department undertook 8,946 hours of policy advice in 2016–17, which was significantly lower (16 per cent) than the result of 10,641 in 2015–16 and the target of 10,240 (13 per cent). The reduction in policy hours undertaken during the reporting period compared to both the target and 2015–16 actual reflects a change in focus towards priority areas of compliance and information provision to clients, particularly during the first half of 2016–17.

The average cost per hour of policy advice in 2016–17 was $254.11; 43 per cent more than the 2015–16 actual result of $177.63; and 41 per cent more than the target of $179.82. The increase in cost per unit was mainly attributed to the realisation of Divisional reform during the reporting period and the creation of the new Building and Construction Code Monitoring Unit, which created a cross-over of work and a change in resource allocation.


Key efficiency indicator 4.2 - Average cost per client contact to provide information and adviceThis indicator reflects the information and advice activities delivered to clients through the Labour Relations Service. It includes activities relating to the department’s role in the implementation and application of the Public Sector Wages Policy Statement 2016; the provision of labour relations services to and on behalf of government and public sector employers; and provision of information and education services to private sector employees and employers on their employment rights and obligations.

Through the Labour Relations Service, the department undertook 1,442,051 information and advice activities; which is slightly more than both the 2015–16 result of 1,361,172 (6 per cent) and the estimated 1,385,152 (4 per cent). As a result, the cost per unit of information and advice for 2016–17 of $2.61 was slightly less than both the 2015–16 figure of $2.70 (3 per cent) and the target of $2.76 (5 per cent).

Key efficiency indicator 4.3 - Average cost per inspection or investigationThis indicator reflects the regulatory enforcement of State awards, agreements and industrial laws through the Labour Relations Service. It includes the investigation of complaints from employees alleging that an employer has failed to pay appropriate entitlements.

Through the Labour Relations Service, the department conducted 252 conciliations, investigations and prosecutions in 2016–17, which was more (7 per cent) than the 235 in 2015–16, but lower (8 per cent) than the target of 275. This increase between the 2015–16 and 2016–17 actuals is primarily attributable to an increase in investigations undertaken during the reporting period. The Division also implemented new policies and guidelines during 2016–17 to improve the timeliness and effectiveness of investigations. The average cost per inspection or investigation was $9,124 in 2016–17, which was significantly higher (21 per cent) than the 2015–16 result of $7,524, and the target of $5,982 (53 per cent). This is attributable to an increase in allocated resources, primarily due to the Divisional reform undertaken during the reporting period and the creation of a new business area focussing on monitoring the recently introduced Western Australian Building and Construction Code of Conduct 2016.


Outcome five

A workplace operated in a safe and healthy manner.

Key effectiveness indicator 5The extent to which workplaces meet occupational safety and health criteria in priority areas (to indicate that workplaces are operated in a safe and healthy manner)


Measure2012–13

Actual2013–14

Actual2014–15

Actual2015–16

Actual2016–17


The extent to which workplaces meet occupational safety and health criteria in priority areas (to indicate that workplaces are operated in a safe and healthy manner)(1)

No. Priority Inspection Reports

15,481 17,113 17,993 20,189 18,857

No. compliant 10,570 11,603 12,736 14,716 13,567

Result 68% 68% 71% 73% 72% 75%

Notes:(1) This effectiveness indicator was introduced in 2015–16 Budget Papers. As it was based on a previous underpinning

measure historical data is available for earlier years.(2) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

This indicator examines the department’s effectiveness in ensuring workplaces operate in a safe and healthy manner. This is assessed in terms of the extent to which workplaces meet occupational safety and health criteria in priority areas. During the course of investigations, inspectors complete Priority Inspection Reports (PIRs). These PIRs contain a checklist of elements constituting the minimum requirements for inspectors to assess when the workplace being visited falls within one of the priority areas. All investigations for PIRs were conducted using a standard format introduced during 2000–01. The checklist of elements, used as the assessment tool, is not a full compliance check, but represents the key elements established for the relevant priority area. For some of these workplace investigations which fall within one of the priority areas the inspector assesses the priority area to determine if compliant or non-compliant and prepares a PIR. Not all visits/inspections include PIRs.

During 2016–17, 18,857 PIRs were undertaken as compared to 20,189 in 2015–16 to provide the result reported. Of these, 72 per cent were found to be compliant, which was slightly lower than the target of 75 per cent but comparable to the 2015–16 result of 73 per cent.


Service 5: WorkSafe

The provision of advice, information, education, licencing and enforcement services to the Western Australian community in the area of occupational safety and health.

This service and related efficiency indicators were introduced as part of the 2015–16 Budget Papers process. Prior to this the WorkSafe Division contributed to a combined service with Energy Safety, Labour Relations and Building Commission.

Table 17: Key efficiency indicator 5.1

Indicators2014–15

Actual2015–16

Actual2016–17

Actual2016–17

Target

5.1 Average cost per client contact to provide information and advice $4.00(1) $3.34(1) $3.04 $3.62(2)

5.2 Average cost per inspection or investigation $2,013(3) $1,785(3) $2,111 $1,913(3)

5.3 Average cost per registration or licence $84.53(1) $86.47(1) $90.05 $77.67(2)

Notes:(1) The 2014–15 and 2015–16 results shown are as published in the department’s 2015–16 Annual Report.(2) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.(3) For comparison purposes, these results have been recast due to the change in methodology in 2016–17.

Key efficiency indicator 5.1 - Average cost per client contact to provide information and adviceThis indicator includes activities in the areas of occupational safety and health, relating to the provision of information and education to members of the community to encourage, influence and promote safer and healthier workplaces for all.

Customer enquiry services are usually one-to-one transactions of a short duration. The transactions can be in person, emailed, written or via telephone. Other activities are automated such as online visitors to the website, or include the delivery of services, such as the Work Safety Awards event or Safe Work October campaigns.

Through the WorkSafe Service, the department undertook 1,144,273 activities in 2016–17 to provide information and advice services, which is more than both the 1,054,379 undertaken in 2015–16 (9 per cent) and the estimated 967,993 (18 per cent). An overall increase in web traffic to the WorkSafe website, specifically including the SmartMove page, led to the quantity of client contacts increasing during the reporting period. As a result, the average cost per client contact to provide information and advice in 2016–17 of $3.04 was less than both the 2015–16 figure of $3.34 (9 per cent) and the 2016–17 target of $3.62 (16 per cent).


Key efficiency indicator 5.2 - Average cost per inspection or investigationA key element of the department’s regulatory enforcement regime is inspections, investigations and compliance activities. The aim of departmental staff is to determine if a breach of the law has occurred, or is occurring, and to correct these by means of education or enforcement.

Inspections and investigations are usually one-to-one transactions, such as an Inspector entering a workplace to ensure compliance against occupational safety and health requirements. These services may require several occasions of contact or supplementary tasks. The provision of these services usually requires a site visit by an inspector.

The methodology for this efficiency indicator was amended during 2016–17 and includes only the number of ‘investigations’ reported via the case management system, and no longer includes the number of PIRs (which more accurately reflect the compliance and will continue to be used to measure the effectiveness indicator 5 above). This indicator includes audits carried out by inspectors on registered assessors and licence holders, inspections on workplace premises and investigations of businesses or employer.

Through the WorkSafe Service, the department in 2016–17 conducted 7,540 inspections or investigations which is less than the 2015–16 figure of 8,736 (14 per cent), and the anticipated 8,341 (10 per cent). The complexity and scope of some serious injury and fatality investigations conducted in 2016–17, particularly fatality investigations in the construction industry, reduced the number of available inspector resources available to conduct other additional investigations and inspections. Consequently, the average cost per inspection or investigation in 2016–17 of $2,111 was more than the 2015–16 result of $1,785 (18 per cent) and the target of $1,913 (10 per cent) due to the decrease in the number of inspections or investigations during the reporting period.

Key efficiency indicator 5.3 - Average cost per registration or licenceWorkSafe issues and administers Asbestos Removal Licences, Demolition Licences, High Risk Work Licence (HRWL) per class issues and the renewal of HRWL, Assessor Registrations, Plant Design Registrations and Plant Registrations.

In 2016–17, through the WorkSafe Service, 65,951 registrations and licences were issued by the department, which was lower (2 per cent) than the 67,020 in 2015–16, and less (11 per cent) than the anticipated 73,937. This was the result of the construction phase of major infrastructure projects drawing to a close and slowing building construction activities, which impacted on the number of licences issued during the 2016–17 reporting period. The average cost per registration or licence in 2016–17 of $90.05 was more than the 2015–16 result of $86.47 (4 per cent) and the target of $77.67 (16 per cent) due to the decrease in the number of licences or registrations during the reporting period.


Outcome 6

Buildings and plumbing installations that are safe, sustainable and respond to community needs.

Key effectiveness indicator 6The extent to which building service providers comply with regulatory requirements


Measure2014–15 Actual(1)

2015–16 Actual

2016–17 Actual

2016–17 Target(2)

The extent to which building service providers comply with regulatory requirements.

No. of elements N/A 18,950 15,525

No. compliant N/A 14,850 11,972

Result N/A 78% 77% 85%

Notes:(1) This indicator was implemented for 2015–16 reporting as part of the 2016–17 Budget Papers process and as such there is

no historical ‘2014–15 Actual’, the result is shown as N/A.(2) The target is derived from the ‘2016–17 Budget Target’ figure published in the department’s 2016–17 Budget Papers.

This indicator provides information regarding this department’s effectiveness concerning the achievement of buildings and plumbing installations that are safe, sustainable and respond to community needs. During 2016–17, there were 5,676 proactive inspections undertaken as part of the audit program in relation to the priority areas for registered building contractors, licensed plumbing contractors, registered painters, registered building surveyors and non-registered building service providers (i.e owner-builders) as compared to 5,731 in 2015–16. The 2016–17 result for this indicator was that 77 per cent of building service providers complied with regulatory requirements, which is comparable to the 2015–16 result of 78 per cent. This target of 85 per cent was set as a stretch target that aspires to achieve the outcome of a higher level of compliance within the building service provider industries.


Service 6: Building Commission

The provision of government administration, licensing, regulatory and dispute resolution services that enable the building and plumbing industries, to efficiently deliver buildings and plumbing installations, that are safe, sustainable and respond to community needs.

Table 19: Key efficiency indicator 6.1–6.4

Indicators(1)

2015–16 Actual(2)

2016–17 Actual

2016–17 Target(3)

6.1 Average cost per inspection $708.89 $888.81 $651.60

6.2 Average cost per registration or licence administered $395.41 $425.98 $403.37

6.3 Average cost per building services and home building work contract dispute resolved. $6,242 $6,652 $6,802

6.4 Average cost per policy project managed $126,231 $154,717 $129,884

Notes:(1) The Building Commission refined its definition of its service and introduced four new efficiency indicators in the 2016–17

Budget Papers process for implementation in 2016–17 reporting.(2) For comparison purposes the 2015–16 Actual results have been recast.(3) The targets are derived from the ‘2016–17 Target’ figures published in the department’s 2016–17 Budget Papers.

Key efficiency indicator 6.1 - Average cost per inspectionA key element of this department’s regulatory enforcement regime is to perform inspections of building services work to ensure compliance with building standards or the approved plans and specifications. Inspections of building services work (including that of builders, painters, plumbers and building surveyors) may be undertaken. Inspections performed fall under three categories:

• General inspections: Proactive inspections designed to determine how building services have been carried out and how building standards have been applied.

• Compliance audit inspections: Inspections undertaken of the work of a building services provider as part of a compliance audit.

• Investigations: Inspections undertaken as part of an investigation into an alleged disciplinary matter or statutory offence.

During 2016–17, through the Building Commission Service, the department conducted 5,606 inspections, which is less than both the 2015–16 figure of 5,878 (5 per cent), and the anticipated 6,280 (11 per cent). This variation was due to a number of resources being diverted to major building audits, such as the Perth Children’s Hospital, meaning a reduced availability to participate in general audit and inspection programs. This overall decrease in the total number of inspections undertaken and the increase filling of employee vacancies in 2016–17 meant the average cost per inspection for 2016–17 of $888.81 is more than both the 2015–16 result of $708.89 (25 per cent) and the target of $651.60 (36 per cent).


Key efficiency indicator 6.2 - Average cost per registration or licence administeredRegistration and licensing service transactions can be received in person or by written correspondence and require the assessment of the applicant’s information and the processing of forms. However, transactions may include involvement of a regulatory board and follow up by staff to ensure all required documentation is received.

This indicator was revised during the 2016–17 Budget Papers process for implementation during the 2016–17 reporting period to now be a point in time measure, that being the sum of all current registrations or licences at the end of the financial year.

During 2016–17, through the Building Commission Service, 24,110 registrations and licences were administered by the department which was slightly more (2 per cent) than the 23,655 in 2015–16, and the anticipated 22,996 (5 per cent). The average cost per registration or licence administered in 2016–17 of $425.98 was slightly more than the 2015–16 result of $395.41 (8 per cent) and the target of $403.37 (6 per cent).

Key efficiency indicator 6.3 - Average cost per building services and home building work contract dispute resolvedThis new indicator measures the efficiency with which the Building Commission Division finalises complaints that it receives thus providing a measure of its dispute resolution service (for the purpose of this indicator, the finalisation of a complaint includes complaints that may be: dismissed; refused; referred to the State Administrative Tribunal; or subject to orders issued by the Building Commissioner).

During 2016–17, through the Building Commission Service, 897 building services and home building work contract disputes were finalised. This was less than the 1,018 finalised in 2015–16 (12 per cent) and the anticipated 1,020 (12 per cent). The average cost per building services and home building work contract dispute finalised in 2016–17 of $6,652 was slightly less than the target of $6,802 (2 per cent), but slightly more than the 2015–16 actual of $6,242 (7 per

cent) due to a decrease in the number of building services and home building work contract disputes received in the reporting period.

Key efficiency indicator 6.4 - Average cost per policy project managedThis is a new indicator to measure the efficiency in which the Building Commission Division provides policy advice and administrative support to government through legislative policy projects, administration of the home indemnity insurance scheme, administration of the adjudication system established under construction contracts legislation, as well as coordinating appointments to the Architects Board, the Building Services Board and the Plumbers Licensing Board.

For the Building Commission Service, the department undertook 38 policy projects during the 2016–17 reporting period, which was more than the anticipated target of 34 (12 per cent) and the 36 undertaken in 2015–16 (6 per cent). The slight increase in the quantity of projects was more than offset by increased staffing costs associated with the recruitment of additional staff to progress the former Government’s election commitments in relation to security of payments reform; and the transfer of the administration of the adjudication system established under construction contracts legislation to the policy branch in January 2017. This change in resourcing meant that the average cost per policy project in 2016–17 of $154,717 is more than both the target of $129,884 (19 per cent) and the $126,231 (23 per cent) of 2015–16.


Ministerial directives

Treasurer’s instruction 903(12) requires the department to disclose information on any Ministerial directives relevant to the setting and achievement of desired outcomes or operational objectives, investment activities and financing activities. There were no directives issued by the responsible Minister during 2016–17.

Other financial disclosures

Pricing policies for servicesStatutory fees are charged to the public for various licensing and other services provided by the department. These fees are reviewed annually in accordance with government policy.

The fee changes for 2016–17 were published in Government Gazette No. 91 on 3 June 2016 and came into effect on 1 July 2016. Details regarding the fees are available on the department’s website.

Capital works projectsThe department’s capital works program provides essential infrastructure support that allows it to implement a range of projects that assist it in the delivery of its services. Table 20 identifies the capital works projects that remain ongoing at the end of the financial year.

There were no completed or discontinued capital works projects during 2016–17.

Table 20: Ongoing capital works projects

Project titleEstimated total

cost ($’000)

Estimated cost to complete

($’000)Planned year

of completionInformation Communication Technology (ICT) Infrastructure:

Building Commission – Regulation reform 4,850 3,634 2018–19EnergySafety Compliance Management System – Stage two 2,547 1,943 2018–19

Strategic Information Plan 20,134 9,509 2019–20

Southern precinct 1,865 1,423 2018–19

Governance disclosures

Unauthorised credit card expenditureAgencies are required to publish details in their annual report of instances where a Western Australian Government Purchasing Card (a ‘credit card’) is utilised for personal use. Officers of the department hold corporate credit cards where their job functions warrant use of this facility. During the financial year 8,698 transactions worth $3,224,771 were performed, including the following accidental use of corporate cards for personal use:

2016–17

Number of times the corporate credit card was used for personal purposes $9.00

Aggregate amount of personal use expenditure $400.09

Aggregate amount of personal use expenditure settled by the due date $208.09

Aggregate amount of personal use expenditure settled after the due date $192.00

Aggregate amount of personal use expenditure outstanding at June 30 $0.00

Number of referrals for disciplinary action instigated $0.00


Governance frameworkThe department operates under a governance structure in which authority and accountability is shared between the Director General and the divisions. While the Director General has ultimately accountable for the full range of the department’s activities, the divisions, through the relevant Executive Director, has considerable autonomy in day-to-day decision-making, allocation of resources and determination of priorities within the divisions.

The Corporate Charter as maintained by the department sets out the governance principles under which it operates and establishes the limits of divisional autonomy in the key areas of:

• accountability and decision-making;

• role and operation of the Corporate Executive;

• strategic planning and reporting;

• financial and human resource management; and

• ministerial communication and correspondence.

The Corporate Charter also provides procedures for managing:

• internal committees;

• Corporate Executive submissions; and

• policy development.

Internal auditInternal Audit provides independent analysis, appraisal and advice concerning a range of the department’s functions, services and systems. Activities include audits of the department’s management information systems; assessment of compliance with legislation and assessment of controls over accounting and financial records. The Internal Audit Charter and Terms of Reference for the Audit and Risk Governance Committee were also refreshed during the year. The Audit and Risk Committee met on five occasions in 2016–17.

Key audits undertaken during 2016–17 include: compliance with State Supply Commission requirements; licensing benchmark review; corporate credit cards; BondsOnline eTransactions; and bond manual forms. In addition, controls advice was provided in relation to the new online licensing system being developed by the department.

Risk and business continuity managementThe department continues to implement the policy, process and procedures outlined in its risk management framework, ensuring that operational areas identify and assess key risks, and develop and implement risk treatment plans in accordance with the Australian and New Zealand Standard for risk management (AS/NZS ISI 31000:2009).

The department’s business continuity plans were reviewed and refreshed during the year, and disaster recovery testing for two operational systems was successfully executed.

Boards, commissions, committees, councils and tribunals

The boards, commissions, committees, councils and tribunals facilitated by the department are responsible for the delivery of a range of advisory, regulatory, industry licensing and dispute resolution functions. They are identified in Table 21 on the next page according to the department’s division that they fall under. Appendix 4: Functions of boards, commissions, committees, councils and tribunals provides further detail on their specific roles and functions and a breakdown of the remuneration received by their members.


Table 21: Boards, commissions, committees, councils and tribunals

Division Board, commission, committee, council or tribunal

Building Commission • Building Services Board

• Plumbers Licensing Board

Consumer Protection • Charitable Collections Advisory Committee

• Consumer Advisory Committee

• Motor Vehicle Industry Advisory Committee

• Property Industry Advisory Committee

EnergySafety • Electrical Licensing Board

• Gas Licensing Committee

Labour Relations and Industry Development

• Australian Marine Complex Overarching Committee

• Western Australian Technology and Industry Advisory Council (TIAC)

• Wheatstone Local Content Steering Committee

• Browse Local Content Steering Committee

WorkSafe • Commission for Occupational Safety and Health

• Construction Industry Safety Advisory Committee

• WorkSafe Awards Judging Panel

• Legislation Advisory Committee

• Mining Industry Advisory Committee

• Focus Area Working Party(s)


Other legal requirements

AdvertisingIn accordance with section 175ZE of the Electoral Act 1907 the department’s 2016–17 expenditure in relation to payments made to advertising agencies, direct mail organisations and media advertising organisations is detailed in the table below.Table 22: Total expenditure 2016–17 (figures have been rounded to the nearest dollar.)

Expenditure category and organisations Total cost ($)

Advertising agencies 97,887

Adcorp Australia Limited 39,592

Community Newspaper Group Limited 9,285

Farm Guide 1,530

Western Australian Newspapers Ltd 46,426

Western Indigenous Media T/A Mulga Mail 1,054

Direct mail organisations 3,181

Campaign Monitor 108

CreateSend.com 380

Ezimail 990

Zipform Pty Ltd 1,702

Media advertising organisations 130,110

Carat Media Services Pty Ltd 121,473

Facebook 137

Marketforce 8,500

Total 231,178

Compliance with public sector standards

In accordance with section 31(1) of the Public Sector Management Act 1994 the department complied with the Public Sector Standards and the Western Australian Public Sector Code of Ethics. Policies and procedures designed to ensure such compliance (including the department’s Code of Conduct) were in place and appropriate internal assessments were conducted.The number of breaches lodged, found and still under review during 2016–17 is detailed in the table below.Table 23: Applications for breach of standard and corresponding outcomes for 2016–17

Number

Number lodged 6

Number of breaches found (including details of multiple breaches per application) 0

Number still under review 0




Table 24 provides details on activities undertaken by the department relating to ensuring compliance with Public Sector Standards and ethical codes in 2016–17. This information has also been provided to the Public Sector Commission for inclusion in the State of the Sector Report. Human resources policies and ethical codes in relation to these standards and codes are available to all employees through the department’s intranet site and online induction package.

Table 24: Activities relating to monitoring compliance with Public Sector Standards and ethical codes for 2016–17

Public Sector Standards

• Completion of audit and reviews of human resources related processes. This includes audits of all employment selection processes undertaken by the department to verify compliance with Public Sector Commissioner’s Instruction No. 1: Employment Standard; reviews of the controls over employee commencements and terminations; and the adequacy and accuracy of payroll procedures.

• Maintenance of resources to educate and support line managers in their roles. One such resource is the Managers Toolkit, available on the department’s intranet, which provides managers with an array of information, support and tools to help them effectively and efficiently manage their staff.

• Provided information to new employees and contract staff as part of the induction program and maintained regular information and highlighted articles on intranet site for all staff.

Western Australian Public Sector Code of Ethics

• Monitored targets for staff completion of Accountable and Ethical Decision Making training in performance agreements for the Director General and Executive Directors.

• Provided information to new employees as part of the induction program.

Code of Conduct

• Provided information to new employees as part of the induction program; all new employees are required to confirm their responsibility to read and adhere to the Code of Conduct.

Disability access and inclusion outcomes

The department is committed to improving access and equity for all its customer groups and ensuring that people with disability are included, and participate, in shaping the range of services and initiatives of the department. The Disability Services Act 1993 requires that public authorities develop and implement a Disability Access and Inclusion Plan (DAIP) to achieve the seven access and inclusion outcomes specified by the Disability Services Commission and report on these achievements.

Table 25 provides a summary of how the department provided access to its services, buildings and information in accordance with the Disability Access and Inclusion Plan 2017–21 – Annual Implementation Plan 2016–17.


http://www.commerce.wa.gov.au/publications/disability-access-and-inclusion-plan-2017-2021


Table 25: Disability access and inclusion outcomes for 2016–17Outcome 1 - People with disability have the same opportunities as other people to access the services of, and any events organised by, the relevant public authority.

• Produced an accessible version of the Guide to Creating Accessible Events and promoted this to staff.• Collected data for reporting on contractor’s compliance with DAIP requirements.• The Disability Access and Inclusion Committee (Committee) met four times during the financial year

to review the progress of the Implementation Plan and other disability access and inclusion activities.• Reported to the Committee unresolved and emerging issues relating to providing services to people

with disability.• Provided an end-of-year update on the progress of the DAIP to the Corporate Executive.

Outcome 2 - People with disability have the same opportunities as other people to access the buildings and other facilities of the relevant public authority.

• Building access maps were maintained on the department’s website.• Details of public parking facilities for people with disability were maintained on the

department’s website.• Parking facilities for staff with disability were made available where needed.• Building access audits were undertaken for all of the department’s work sites.• A Personal Emergency Evacuation Plan was developed for any staff with physical, mental

or sensory impairment, either temporary or permanent that requires assistance during an emergency evacuation.

• The Disability Services Commission’s initiative Changing Places was promoted internally to staff.

Outcome 3 - People with disability receive information from the relevant public authority in a format that will enable them to access the information as readily as other people are able to access it.

• A guide on how staff can obtain alternative formats for people with disability was promoted internally to all staff.

• Strived to ensure that any new or re-printed publications contained a statement advising the availability of alternative formats.

• Conducted a review of the content on the disability access and inclusion information intranet page.• Updated the department’s website to include the Disability Access and Inclusion Feedback form.

Outcome 4 - People with disability receive the same level and quality of service from the staff of the relevant public authority.

• News stories to raise awareness of the importance of carers were promoted to staff.• News stories to raise awareness of World Autism Week and World Down Syndrome Day were

promoted to all staff.

Outcome 5 - People with disability have the same opportunities as other people to make complaints to the relevant public authority.

• The department continually monitored the mailbox [email protected] to ensure complaints about access and inclusion are addressed.


Outcome 6 - People with disability have the same opportunities as other people to participate in any public consultation by the relevant public authority.

• The needs of people with disability were considered when arranging events/public consultation information sessions.

• Disability access and inclusion stakeholders were consulted during the review of the department’s DAIP and the development of the new DAIP.

Outcome 7 - People with disability have the same opportunities as other people to access employment with the Department of Commerce.

• Applicants are asked if they required additional assistance to attend interviews when applying for an advertised vacancy.

• Equal opportunity statement promoting commitment to workplace equity and diversity and encouraging people with disability to apply, was published on every advertised vacancy.

• Applicants were advised in job advertisements that information can be provided in alternative formats on request.

Recordkeeping Plans

As required, under section 19 of the State Records Act 2000 (SR Act), the department has a Recordkeeping Plan which was approved by the State Records Commission in August 2012. The Plan, approved on 30 August 2012, is accessible to all staff via the department’s intranet.

In accordance with section 29 of the SR Act, a review of the Recordkeeping Plan was undertaken during 2016–17. The Recordkeeping Plan Review Report was approved by the department’s Director General and sent to the State Records Office on 20 June 2017. It has been presented to the State Records Commission for consideration. By submitting this Review Report, the department complied with the requirement to review its Recordkeeping Plan within a five year period.

Recordkeeping policyIn line with the State Records Commission Standard 2, Principle 2, the department’s recordkeeping program is supported by policies and procedures. The Recordkeeping Policy and the Digital Transition Policy establish the object and intent of the recordkeeping program. Standards, operating procedures and business rules direct and frame recordkeeping practice at the desktop.

The Recordkeeping Policy has been reviewed and updated, along with a number of operational and desktop procedures.

Recordkeeping systemThe repositories of recorded information, related to business transactions and activities across the department, are a combination of business-specific information systems and an electronic document and records management system (EDRMS).

Evaluation of the efficiency and effectiveness of the recordkeeping systemsAt the system level, qualitative and quantitative checks of the EDRMS are conducted on a regular basis. Monthly statistics analyse system usage and availability, storage levels and demand. Data integrity is maintained using regular checks and audit trails that capture all actions on files and documents.

Digitisation strategyIn 2016, the Commerce Digitisation Program was established. There were three projects in the work program.

• EDRMS Refresh Project – a project to replace and upgrade the existing EDRMS to obtain greater functionality, useability and value for money. A project team was established to evaluate current and future needs. A tender for replacement software was initiated.

• Digital Transition Project – a project to promote and support adoption of a predominately digital and paper-limited records and information environment, using




a combination of business process re-engineering and automation. This project is to continue when the EDRMS Refresh Project is completed.

• Paper Debt Reduction Project – a project that aims to reduce the reliance on paper records and address the stockpile of physical files and documents. Preliminary work has been undertaken to identify the scope of the project.

Staff training, information sessions

On-boarding and off-boarding processes have been established for the department. Designated records staff continue to schedule one-to-one desktop sessions for new staff which are focused on identifying the employee’s business needs and associated recordkeeping requirements. Records staff also work with employees leaving the department to ensure there is an orderly handover of files and all departmental documents are captured into the EDRMS or relevant business system.

All staff using the EDRMS are required to complete an online training module. Face-to-face sessions are arranged for individuals or groups requesting training on specific functions.

Records staff can access subject-specific training courses delivered by an external service provider. Records staff can also use workshops and presentations offered by the State Records Office and Records and Information Management Professionals Australasia (the national professional body) for ongoing professional development.

Induction program

All new staff, including temporary staff and contractors, are required to complete the online recordkeeping module mandated in the department-wide induction program. The course covers the legislative and policy framework for recordkeeping, the role of managers and supervisors, and individual responsibilities of government employees.

A minimum pass mark has been set, along with a time frame for completion. Reporting tools monitor progression and completion rates. Participants and line managers are alerted if the course has not been completed within the specified time frame.

Education and awareness

The intranet is used to publish information about recordkeeping. News bulletins draw attention to the changing nature of records and information management, provide advice or instruction on handling physical records, and guidance on the management of digital records. Periodic department-wide and divisional emails remind staff of the department’s needs and practices regarding recordkeeping and individual recordkeeping responsibilities and obligations.

Freedom of Information

The Freedom of Information Act 1992 gives the public a right to access departmental documents, subject to some limitations. The public can also apply to have personal information about themselves, held in departmental documents, amended if that information is inaccurate, incomplete, out of date or misleading. Where possible, information is disclosed outside the Freedom of Information process. If this is not possible, access applications are dealt with promptly and efficiently, and at the lowest possible costs.

Access applications can be lodged personally at metropolitan and regional offices, or sent to a central post office address.



International Labour Organisation Convention 81: Labour Inspections

Australia is a member nation of the International Labour Organisation. The International Labour Organisation is the peak international organisation responsible for setting international labour standards through the development and monitoring of International Conventions and Recommendations. The Australian Government ratified International Labour Organisation Convention 81 - Labour inspections on 24 June 1975. Article 21 of Convention 81 requires certain information to be published in annual reports for each of the central inspection authorities.

In Western Australia, the department is the ‘central authority’ responsible for conducting labour inspections for workplace safety, and wages and conditions of employment. The reporting in this section relates to the inspection services delivered by the Labour Relations and Industry Development Division and the WorkSafe Division for 2016–17.

Article 21 of Convention 81 requires the department to report on a number of matters namely:

(a) Laws and regulations relevant to the work of the inspection service

Legislation administered by the department is provided in the Overview section of this report. Changes to written laws during 2016–17, relevant to the work of the inspection service, are provided in Appendix 2: Changes to written laws (Table 40). The Significant issues impacting the agency section of this report also provides information on issues and trends impacting the department and the inspection environment.

(b) Staff of the labour inspection service

In 2016–17, the department employed the full-time equivalent of 8.55 industrial inspectors in the Labour Relations and Industry Development Division. The WorkSafe Division had a full time equivalent complement of 93 inspectorate staff.

(c) Statistics of workplaces liable to inspection and the number of workers employed

As at June 2016, there was a total of 225,006 businesses operating in Western Australia (Australian Bureau of Statistics, Counts of Australian Businesses, including Entries and Exits, June 2016). As at June 2017, total employment in Western Australia was 1,363,300 persons (ABS, Labour Force – trend data, Australia, June 2017).

It should be noted that the Western Australian industrial relations system applies only to unincorporated businesses and the state public sector. The department estimates that between one third and one fifth of Western Australian employees are covered by the State system.

(d) Statistics of inspections visits

During 2016–17, the Labour Relations and Industry Development Division investigated 108 employers and the WorkSafe Division undertook 7,536 physical workplace visits including repeat visits.

(e) Statistics of violations and penalties imposed

Information on the number of violations and penalties imposed is provided in the Appendix 3: Legal Actions section of this report. Details of prosecutions for the Labour Relations and Industry Development Division are published in Table 62 and prosecutions for the WorkSafe Division are published in Table 63. The details of improvement and prohibition notices issued by the WorkSafe Division are published in 66 to 69. The Labour Relations and Industry Development Division found that out of the 108 employers inspected, 329 separate breaches of awards, agreements or legislation were identified and four prosecutions were undertaken.

(f) Statistics of industrial accidents and occupational diseases

The lost time injury and disease (LTI/D) frequency rate is the principal measure of safety performance in Western Australia,


and is also used to monitor performance against national targets. The frequency rate is calculated using the formula: Number of LTI/D divided by number of hours worked multiplied by 1,000,000. A lost time work-related injury or disease is counted where there is at least one complete day or shift off work.

The Agency Performance (Operational Highlights) section of this report provides information on work-related injury or disease frequency rates for Western Australia. Information on disease groups that are being monitored at a national level are contained in the Safe Work Australia publication, Occupational Disease Indicators. A copy of the publication can be accessed on the Safe Work Australia website (www.safeworkaustralia.gov.au).

Agency specific reporting

Please note, some Act specific reporting figures relating to ongoing complaints, investigations or inquiries for the start of the 2016–17 financial year differ slightly to the ongoing figures for the end of the 2015–16 financial year provided within the department’s 2015–16 annual report. This is due to the data within the Complaints and Licensing System (CALS) used by the department being dynamic in nature with the details and classifications of certain types of complaints, investigations or inquiries changing as a result of the department obtaining further information regarding these complaints, investigations or inquiries. This potential reclassification can result in differing ‘ongoing’ figures.

Building Commission Division

Construction Contracts Act 2004

The Construction Contracts Act 2004 provides for a rapid independent adjudication to resolve payment disputes associated with construction contracts, whether they are written or oral. A decision is made on the information available and can be enforced as if it was an order of the court. This process does not inhibit parties from seeking other legal remedies but this process cannot be used if the dispute is the subject of an order, judgement of other finding dealing with the matter.

Before 1 November in each year, the Building Commissioner must give the Minister a written report about the operation and effectiveness of this Act in the financial year that ended in that year. Quarterly and annual reporting for this Act can be found on the department’s website.

Plumbers Licensing Act 1995

Part 5A of the Plumbers Licensing Act 1995 (the PL Act) establishes the Plumbers Licensing Board (the Board) to regulate the plumbing trade that serves the Western Australian community. The Board forms part of the Building Commission Division.

At the end of the year, there were 7,381 plumbers licensed by the Board to carry out water supply, sanitary and drainage plumbing work for residential, commercial and industrial purposes and for other sectors of the economy. This specialised workforce comprised 3,577 licensed plumbing contractors, 3,673 licensed tradespersons, who work under the general direction and control of the licensed plumbing contractors, 99 restricted plumbing permit holders who replace certain hot water units and 32 provisional tradesperson licences (drainage plumbing).

http://www.safeworkaustralia.gov.au




Section 59H(2) of the PL Act requires the department’s Annual Report to include details of:

(a) the number, nature, and outcome, of –

(i) investigations and inquiries undertaken by, or at the direction of, the Board into licensing under this Act;

Table 26: Plumbers Licensing Act 1995: Compliance investigations and complaints in 2016–17

Alleged unsatisfactory workmanship

Alleged unlicensed plumbing

Other regulation breaches

Total

Ongoing matters as at 1 July 2016 7 12 7 26

Matters commenced 189(1) 19 103(2) 311

Matters concluded 173 20 93 286

Ongoing matters as at 30 June 2017 23 11 17 51

Notes:(1) Rectification notices were issued for all of the matters that were commenced.

(2) 103 infringement notices issued by the Audit Branch includes 5 breaches investigated by the Enforcement Branch.

There were 440 informal complaints received from licensed plumbers about non-compliance by other plumbers and unlicensed plumbing work and 719 informal complaints received from consumers about unsatisfactory plumbing work.

There were 4,684 calls to the technical advice line from licensed plumbers seeking advice on plumbing work.

There were 70 audits of licensed plumbing contractors carried out across the State.

(ii) matters that have been brought before the State Administrative Tribunal under this Act.

There were 178 building service complaints and 0 disciplinary complaints brought before the State Administrative Tribunal in 2016–17.

(b) the number and nature of matters referred to in paragraph (a) that are outstanding;

Of the 51 ongoing matters as at 30 June 2017, there were 23 unsatisfactory workmanship matters, 11 alleged unlicensed plumbing, 4 disciplinary breaches and 13 offences outstanding.

(c) any trends or special problems that may have emerged;

On 15 July 2016 the Building Commission commenced an audit of the Perth Children’s Hospital on aluminium composite panels and fire door sets; stainless steel pipe corrosion; vitreous enamel (VE) panels and curtain wall glazing. The scope of the audit was expanded on 5 September 2016 after the discovery of lead in the drinking water supply at the site. The final report, which was released in April 2017, identified four potential sources of the lead, and remedial work was commenced by the State. The Building Commission is continuing to monitor the situation until the water supply is deemed safe to use as per the Australian Drinking Water guidelines.

(d) forecasts of the workload of the Board in the year after the year to which the report relates; and

There were no forecasts of the workload of the Board.

(e) any proposals for improving the operation of the Board.

There were no proposals for improving the operation of the Board.


Consumer Protection Division

Credit (Administration) Act 1984

The Credit (Administration) Act 1984 sets out a licensing regime for individuals providing credit regulated in Western Australia by the Credit Act 1984 or Consumer Credit (Western Australia) Code. The Commissioner for Consumer Protection was the responsible licensing authority under this Act.

On 1 July 2010 responsibility for regulation of credit was transferred to the Commonwealth Government, specifically the Australian Securities and Investments Commission (ASIC), and the department’s responsibilities in relation to credit regulation ceased. All matters are now managed by the ASIC.

Debt Collectors Licensing Act 1964

The Debt Collectors Licensing Act 1964 (the DCL Act) sets out a licensing regime for debt collectors and prescribes procedures for the handling of trust account money. The Commissioner for Consumer Protection (the Commissioner) is the responsible licensing authority under the DCL Act.

As at 30 June 2017, there were 82 licensed debt collectors operating in Western Australia. Over the course of the year, 7 licences expired and an additional licence was surrendered, 67 licences were renewed and 12 new licences were granted.

Section 12A of the DCL Act requires the Commissioner to report on a number of matters namely:

(a) the number, nature and outcome of –

(i) investigations and inquiries undertaken by, or at the direction of, the Commissioner for the purposes of this Act;

The department dealt with a number of disputes against debt collection agencies during 2016–17, with four of these matters being conciliated between the parties as they represented contractual disputes.

Table 27: Debt Collectors Licensing Act 1964: Investigation summary for 2016–17

Licensing issues relating directly to the

DCL Act

Conduct issues

Conciliations generally

concerning confirmation of whether debt owed

Total

Number ongoing as at 1 July 2016 1 0 0 1

Number commenced 1 0 4 5

Number concluded 1 0 4 5

Number ongoing as at 30 June 2017 1 0 0 1

One investigation about an alleged unlicensed debt collection concluded in 2016–17 for which the interstate debt collector was provided education and direction about operating in Western Australia.

Of the four conciliation matters concluded in 2016–17, three matters resulted in education and advice being provided and one resulted in the parties reaching an agreement.

(ii) Matters that have been brought before the State Administrative Tribunal under this Act;

There were no matters bought before the State Administrative Tribunal under the DCL Act for the 2016–17 financial year.







There is one matter outstanding as of 30 June 2017, which involves unlicensed activities.


There are no known trends or special problems that will affect a change in workload in this area of activity.

(d) forecasts of the workload of the Commissioner in performing functions under this Act in the year after the year to which the report relates; and

There is no change anticipated.

(e) any proposals for improving the performance of the Commissioner’s functions under this Act.

There were no recommendations.

Employment Agents Act 1976

The department administers a range of functions under the Employment Agents Act 1976 (the EA Act) including the granting and renewal of licences, compliance activities and a range of education and advisory services. The Consumer Protection Division undertakes the conciliation of disputes involving employment agents and consumers.

As at 30 June 2017, there were 490 licensed employment agents operating in Western Australia. Over the course of the year, 71 licences expired and an additional two were surrendered, 87 licences were renewed and 49 new licences were granted.

Section 10A of the EA Act requires the Commissioner to report on a number of matters, namely:



Allegations that indicated a breach of legislation may have occurred were categorised as investigations. During 2016–17, the department completed eight investigations about employment licence holders or unlicensed activities. There were six related to allegations of unlicensed activities and two related to conduct of employment agents.

Table 28: Employment Agents Act 1976: Investigations and inquiries in 2016–17 Employment agent licence

holder or unlicensed

activity

Conduct issues Conciliations Total

Number ongoing as at 1 July 2016(1) 1 2 0 3


Number concluded 6 2 0 8


Note:(1) The number of ongoing as at 1 July 2016 may differ from the figures reported in the 2015–16 Annual Report because of

subsequent actions affecting closure dates for investigations and inquiries.



Of the eight investigation matters concluded in 2016–17, the following outcomes were recorded:

• three matters resulted in an administrative warning being issued; and

• five matters resulted in education or advice being provided.

(ii) matters that have been brought before the State Administrative Tribunal under this Act;

No matters were brought before the State Administrative Tribunal under the EA Act for the 2016–17 financial year.


The one outstanding investigation relates to potential unlicensed activities by an employment agent.


This financial year, the main focus of complaints involved operating as an employment agent without the necessary licence.


In the 2015–16 financial year, Consumer Protection sought industry and stakeholder opinions on proposed changes to the EA Act which included the introduction of negative licensing and changes to conduct requirements.

A submission on the proposed changes was provided to the new Government for consideration in the 2016–17 financial year.



Land Valuers Licensing Act 1978

The department administers a range of functions under the Land Valuers Licensing Act 1978 (the LV Act) including the granting and renewal of licences, compliance activities and a range of education and advisory services.

As at 30 June 2017, there were 888 licensed land valuers in Western Australia. Over the course of the year 32 licences expired, 393 licences were renewed, one licence was surrendered and 54 new licences were granted.

Section 31 of the LV Act requires the Chief Executive Officer of the department to report on a number of matters namely:



The department received two complaints during the year. Both complaints related to alleged non-disclosure of material facts.



Table 29: Land Valuers Licensing Act 1978: Investigations and inquiries in 2016–17

Issues concerning valuation practices

Advertising and

marketing issues

Issues relating to fees and charges

Licensing issues Total

Number ongoing as at 1 July 2016 0 0 0 0 0

Number commenced 2 0 0 0 2

Number concluded 0 0 0 0 0

Number ongoing as at 30 June 2017 2 0 0 0 2

The department continued a proactive compliance program introduced in 2011–12 for licensed land valuers. The proactive compliance program aims to assist land valuers in complying with legislative requirements, identify and rectify areas of risk, and provide general advice to licensees on complying with legislative requirements. This financial year, the department visited 87 valuers.

(ii) matters that have been brought before the State Administrative Tribunal (SAT) under this Act;

No matters were bought before the SAT under the LV Act.


There are two outstanding matters as identified in paragraph (a). Both matters, which involve alleged failures to disclose material facts, are currently being examined.


There were no trends or special problems that emerged.


The department will publish educational material in the coming year, where appropriate, to support the new Licensed Valuers Code of Conduct 2016.


The Licensed Valuers Code of Conduct 2016 came into effect on 1 October 2016.

The new Code of Conduct will make the rules consistent, where appropriate, with the other property industry codes of conduct and the Australian Consumer Law. The new code also includes specific supervision requirements for non-licensed assistants who support licensed valuers and further clarification on recordkeeping and risk management requirements.

Motor Vehicle Dealers Act 1973

The department administers a range of functions under the Motor Vehicle Dealers Act 1973 (the MVD Act) including the granting and renewal of licences, compliance activities and a range of education and advisory services.

Section 51 of the MVD Act requires the Chief Executive Officer of the department to report on a number of matters namely:


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Table 30: Motor Vehicle Dealers Act 1973: Investigations and inquiries in 2016–17 Issues

concerning unlicensed activities

General breaches Conciliation(1) Total


Number commenced 85 33 1,229 1,347

Number concluded 68 30 1,237 1,335


Notes:(1) Conciliations are conducted at the direction of the Commissioner, under the Fair Trading Act 2010. Data reported relates to

conciliations involving licensed motor vehicle dealers only.

(2) The number of ongoing as at 1 July 2016 may differ from the figures reported in the 2015–16 Annual Report because of subsequent actions affecting the closure dates for issues concerning unlicensed activities, general breaches and conciliation.

Table 31: The outcomes for the matters concluded were as follows:

Conciliation:

Agreement reached to settle 425Education, advice or information given 189Complaint lapsed or withdrawn 126Complaint not substantiated 74Other 423TOTAL: 1,237

Compliance and Investigations:

Complaint not substantiated 29Education/Advice 24No action taken - other reason 12Corrective advice accepted 11Other 22TOTAL: 98

(ii) matters that have been brought before the State Administrative Tribunal by the Commissioner;

There were two matters brought before the State Administrative Tribunal.


ConciliationsMost of the 90 conciliation matters that remained as at 30 June 2017 related to defective goods, unsatisfactory goods or performance, warranties, contractual disputes, harsh or unconscionable conduct, with the remainder being general issues.

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Compliance and investigationsOf the 68 compliance and investigations matters that were ongoing as at 30 June 2017, 40 related to investigations of unlicensed activities. The remaining concerned fitness to hold a licence, false and misleading advertising, accepting payment without intention to supply, consignment trust account audit matters and general breaches such as misconduct and undesirable practices.


The Department of Transport (DoT) has implemented new analytics software which has seen a significant increase in the number of referrals into potential unlicensed dealing activities. To date, DoT has referred 60 individuals where the data indicates a person has bought or sold a significant number of vehicles.

This influx of unlicensed dealing investigations has necessitated a change in our assessment criteria where focus will be on those with the most significant numbers of activity, ability to readily identify a person of interest, profit made and the overall likelihood of resolving the matter.

The issue of manufacturer’s warranties on ‘demonstrator’ vehicles has also been an area of focus by the department. The MVD Act defines a demonstrator vehicle as a vehicle licensed to the dealer by whom it is being sold or offered or exposed for sale and has been used by that dealer for the purposes of demonstration.

The MVD Act also prescribes that the manufacturer’s warranty on demonstrator vehicles commences at the time the vehicle is sold to the consumer. As such the purchaser is entitled to the full manufacturer’s warranty in terms of time and mileage from the date of purchase. The warranty on a demonstration vehicle is only affected in terms of distance travelled, with the odometer reading at the time of purchase allowed to be deducted.

Industry practice is that the manufacturer’s warranty starts from the time that the vehicle is licensed into the dealer’s name, or ordered by the dealer and not from the time of sale to a purchaser. This right is enshrined in the MVD Act so it is illegal for motor vehicle dealers not to offer buyers the full time length of the manufacturer’s warranty.

The department has done significant education and media with industry and consumers alike to ensure both sides are aware of this requirement and consumer right.

(d) forecasts of the workload of the Commissioner in the year after the year to which the report relates; and

The department forecasts that the current three year average of conciliation complaints (1,400) and investigations (350) per annum will continue in the coming financial year.

(e) any proposals for improving the performance of the Commissioner’s functions.

The department is continuing with a full review of the MVD Act. The initial consultation process with relevant stakeholders and a consultation regulatory impact statement has been completed. The department is in the final stages of completing the decision regulatory impact statement which will be forwarded to the Minister for consideration.

In the interim amendments to the MVD Act will be proposed this year to see the introduction of a uniform audit period for consignment trust accounts. The proposed audit period would be a financial year, with the audit report being due within three months after 30 June of each year. The current audit period is 12 months from the opening of the consignment trust account.

A further amendment will be the removal of the requirement for dealers to have to complete and send in a form when surrendering the licence plates of a vehicle to the Licensing Authority.


This, along with a number of other administrative changes to the Motor Vehicle Dealers (Licensing) Regulations 1974 will reduce the red-tape impost on motor vehicle dealers.

Real Estate and Business Agents Act 1978

The department administers a range of functions under the Real Estate and Business Agents Act 1978 (the RE Act) including the granting and renewal of licences, compliance and conciliation activities and a range of education and advisory services. As at 30 June 2017 there were 4,261 licensed real estate and business agents who held a current triennial certificate and 11,654 sales representatives registered in Western Australia. Over the course of the year, 202 triennial certificates expired and an additional 138 were surrendered, 1,043 triennial certificates were renewed and 306 new licences were granted. During this same period, 1,694 sales registrations expired and an additional 30 were surrendered, 1,819 registrations were renewed and 1,436 new registrations were granted.

Section 135 of the RE Act requires the department to report on a number of matters in its annual report, namely:


(i) investigations and inquiries undertaken by, or at the direction of, the Commissioner;

The department investigated a range of general and financial compliance issues during the year. The investigations examined unlicensed or unregistered activity, failure to disclose pertinent facts, professional conduct, alleged trust account breaches and related auditing matters, advertising and marketing, property management services, and fitness to hold a licence.

Table 32: Real Estate and Business Agents Act 1978: Investigations and inquiries in 2016–17 General

compliance issues

Financial compliance

issuesConciliations Total



Number concluded 584 334 92 1,010


Note:(1) The number of ongoing as at 1 July 2016 may differ from the figures reported in the 2015–16 Annual Report because of

subsequent actions affecting the closure dates for general and financial compliance issues and conciliations.

For the 584 general compliance and investigation matters concluded during the year, the following outcomes were recorded: 229 education or advice letters were sent; 157 warning letters were issued; 121 resulted in no action being taken or no offence detected, 28 matters were referred to another agency; 12 resulted in fines; eight complaints related to briefs for disciplinary proceedings before the State Administrative Tribunal (SAT); two complaints related to briefs for prosecution. The remaining 27 complaints resulted in other compliance outcomes.

Where prosecution matters have been finalised, the outcomes are detailed in Appendix 3: Legal Actions.

The department continued its proactive compliance program that aims to assist agents in complying with legislative requirements, identifying and rectifying areas of risk and providing advice and support to agents in an effort to avert operational problems. The program encourages high levels of industry best practice.



This financial year, the department completed 461 proactive visits, with no major systemic issues identified. Some of the more common issues proactive compliance officers provided guidance on during the year were: poorly written contractual conditions; reconciling trust accounts at the end of the month; correct titling for trust accounts; late renewal of triennial certificates and registrations; keeping sufficient client identification documents; and the process of disclosing and identifying material facts.

The department also administers the Real Estate and Business Agents Fidelity Guarantee Account (REBA Fidelity Account). The purpose of the REBA Fidelity Account is to provide financial reimbursement to people who suffer pecuniary or property loss through any defalcation by a licensee who holds a triennial certificate, in the course of the business of that licensee. This also includes the actions of licensee’s employees.

During the year, consumers lodged 43 new claims against the REBA Fidelity Account and 19 claims were finalised. Eight of the finalised claims were allowed; seven were partially allowed; one was disallowed and two were withdrawn. One further claim resulted in no action being taken. The 15 claims allowed or partially allowed resulted in a total of $168,192 being reimbursed. At 30 June 2017, there were 43 real estate claims outstanding against the account with a total provisional value of $422,326.

(ii) matters that have been brought before the State Administrative Tribunal under this Act;

This financial year, there were 17 matters before the State Administrative Tribunal under the RE Act or the Real Estate and Business Agents and Sales Representatives Code of Conduct 2016. Thirteen of these matters were finalised, two were withdrawn and two were pending. The nature and outcome of all matters are provided in Appendix 3: Legal Actions.

The issues before the State Administrative Tribunal included a real estate sales representative breaching a special condition on his certificate

of registration, a property manager who stole tenants’ money, a real estate agency mishandling the deposit from the sale of a property, a sales representative being banned for misconduct over the sale of properties and a real estate agent being banned over false sales documentation.

(iii) matters that have been dealt with through the conciliation process under this Act;

The department dealt with a range of matters in conciliation during the year, including: property management issues such as fees and charges; bond matters; poor communication; general breaches of legislation; professional conduct; advertising; and marketing.

Of the 92 conciliations concluded during the year, the following outcomes were recorded: 36 resulted in agreement between parties to settle the matter; 29 complaints were unable to be conciliated due to a variety of reasons; 14 education and advice letters were sent; five complaints lapsed or were withdrawn and eight further complaints involved general outcomes. As the nature of disputes is ultimately a civil matter, where conciliation could not reach a resolution and the department felt the complainants had a reasonable case, they were advised of the option of taking their complaint to the Magistrates Court.


As at 30 June 2017, there were 119 investigation matters, 64 financial compliance matters and 10 conciliation matters outstanding.

• The 119 investigation matters relate to: property management; audit matters; unlicensed activities; deceptive conduct; advertising and marketing issues; and general breaches of legislation.


• The 64 financial compliance matters relate to trust account matters and general breaches of legislation.

• The 10 outstanding conciliation matters relate to a range of property management issues.

As at 30 June 2017, there were three matters before the State Administrative Tribunal under the RE Act that have not been finalised, as detailed in Appendix 3: Legal Actions.


The bond administrator identified a substantial increase in the number of late lodgement of tenancy bonds in the second half of 2016. Consumer Protection subsequently warned the real estate industry that it would be taking a close look at any late lodgements.

As part of the process, Consumer Protection provided education advice to a number of property managers and private lessors. The more serious enforcement tools of formal warnings and infringement notices were used for those who had previously been warned and had a history of late lodgements.

Consumer Protection will continue to urge private landlords and real estate agencies to review their current bond processing practices to ensure they comply with their legal obligations.


The Commissioner expects a similar workload for this industry over the coming year. The department will monitor a number of new real estate sales methods that appear to be gaining traction in the marketplace. This includes claims made on comparison websites, online sales platforms and sales techniques such as transparent negotiation.

The Commissioner is also aware that the ongoing soft market conditions are causing real estate agents added financial pressure.

This will require a greater focus on issues such as professional conduct and the protection and security of trust account monies.

The department will disseminate information about new scams and real estate fraud. Proactive education, media and bulletins will play an important role in reminding agents to be aware of best practices and ensure they have the appropriate security strategies in place.

The Commissioner will also monitor the control and supervision of real estate agencies, which will include focussing on such things as the late renewal of triennial certificates.

(e) any proposals for improving the operation of the Commissioner.

On 16 November 2016 the Parliament of Western Australia passed the Residential Tenancies Amendment Bill 2015 and the Licensing Provisions Bill 2015. The amendments reduce the administrative burden for lessors and real estate agents, and should help reduce rental costs for tenants.

The changes will, among other things, simplify the process of serving certain notices and improve the process for dealing with abandoned goods. These changes to the law will be monitored to ensure that the industry understands the changes and implications for their clients.

Retirement Villages Act 1992

The Retirement Villages Act 1992 (the RV Act) was established to regulate retirement villages and the rights of residents in such villages. The Commissioner for Consumer Protection (the Commissioner) is responsible for several functions under the RV Act, including compliance activities and the conciliation of disputes between residents and retirement village operators.

This financial year, the department conciliated or investigated 44 complaints relating to retirement villages of which 34 were finalised. The complaints related to a diverse range of matters including issues regarding unjust fees,

http://www.slp.wa.gov.au/legislation/statutes.nsf/main_mrtitle_841_currencies.html


general financial management, misleading advertising and general property management.

The department has continued with a proactive compliance program to ensure retirement village operators comply with the requirements set out in the RV Act. This program aims to provide assistance to retirement villages where issues of non-compliance are identified. As part of the program, proactive compliance officers also meet with representatives of village residents committees and discuss any issues that the residents may have with village management.

The department also visited 74 retirement villages and identified a range of issues including the mistaken use of residential tenancy agreements rather than compliant contracts. A visit to a retirement village in the south west also found concerns about its financial viability. The department is currently investigating this matter.

Officers provided educational advice and monitored the various operators’ progress in implementing compliant contracts and addressing the financial management issues.

Changes from the Statutory Review of Retirement Villages Legislation came into force this financial year. One change included village operators having to provide new disclosure statements that inform potential residents about key features and costs associated with entering, living in and leaving a retirement village before they sign a contract.

Work has progressed on the second stage of reforms from the Statutory Review, focussing on the key concept provisions of the legislation in the context of emerging village models; provision for partial removal of a retirement memorial without diminishing residents’ rights; reserve funds; and the creation of a public list of retirement villages with prescribed information. Stakeholder consultation around implementation of some of the remaining reforms is scheduled for late 2017.

During the financial year, the department also dealt with a range of issues involving a not-for-profit incorporated association that owns and runs a number of retirement villages. The main concerns included allegations of financial

mismanagement, bullying conduct, a lack of corporate oversight, prevention of the formation of a residents’ committee and a non-compliant dispute resolution process. The department managed to resolve the substantive concerns so no further action was required. Investigations and independent experts determined there were no substantive financial concerns.

However, it was evident the Board of Management may not have fully appreciated some of the financial risks associated with a number of corporate management issues. Management therefore agreed to put in place a range of governance checks and balances, which included keeping residents informed of developments and addressing poor communication between management and residents.

The department was also instrumental in resolving a number of matters at a not-for-profit incorporated association that runs three western suburbs retirement villages as one village. The issues included: financial mismanagement; a precarious financial position; and a (former) board that lacked the acumen to run the village. The department worked closely with residents and the board to protect the interests of residents. Election of a new board and developing a business model to stabilise the financial position of the association are in progress.

The department’s Seniors Housing Advisory Centre continues to provide advice to consumers on their retirement housing options, enabling informed choices when entering into a residence contract or other form of retirement living.

Settlement Agents Act 1981

The department administers a range of functions under the Settlement Agents Act 1981 (the SA Act) including the granting and renewal of licences, compliance activities and a range of education and advisory services. As at 30 June 2017, there were 686 licensed settlement agents who held a current triennial certificate in Western Australia. Over the course of the year, 30 triennial certificates expired and an additional 23 were surrendered, 183 triennial certificates were renewed and 30 new licences were granted.



Section 112 of the SA Act requires the department to report on a number of matters namely:(a) the number, nature and outcome of –

(i) investigations and inquiries undertaken by, or at the direction of, the Commissioner and;

The department investigated matters relating to general breaches of legislation, unlicensed activity, alleged audit and trust account breaches, general financial mismanagement, failure to act in the best interest of a principal and failure to ascertain pertinent facts.

Table 33: Settlement Agents Act 1981: Investigations and inquiries in 2016–17

General compliance

issues

Financial compliance

issuesTotal

Number ongoing as at 1 July 2016

6 1 7

Number commenced 33 36 69

Number concluded 31 36 67

Number ongoing as at 30 June 2017

8 1 9

Of the 67 compliance matters concluded during the year, the following outcomes were recorded: 37 education or advice letters were sent; 13 warning letters were issued; 10 complaints resulted in no action due to no offence being detected or other reasons; four were referred for investigation; one complaint was referred to another agency; one involved a lapsed license and one complaint was withdrawn.

The department continued its proactive compliance program that assists agents to understand and comply with legislative requirements, to identify and rectify areas of risk and provide advice

and support. The program promotes high levels of industry best practice. This financial year the department completed 98 proactive visits. Some of the more common issues identified included: agencies failing to reconcile their trust accounts on a monthly basis; not correctly naming trust accounts; incorrect information on documents and correspondence; errors on forms allowing the agent to act for both parties; failure to secure valuable documents; and errors on forms that provide an agent with a valid appointment to act.

The department also administers the Settlement Agents Fidelity Guarantee Account (SA Fidelity Account). The purpose of the SA Fidelity Account is to provide financial reimbursement to people who suffer pecuniary loss or property loss through any defalcation by a licensee, in the course of the business of that licensee. This also includes the actions of the licensee’s employees.

During the year, one new claim for $68,775 was lodged against the SA Fidelity Account. No claims were finalised. As at 30 June 2017, there were two claims outstanding against the account with a total provisional value of $103,046.

(ii) matters that have been brought before the State Administrative Tribunal under this Act.

No matters were bought before the State Administrative Tribunal under the SA Act.


As at 30 June 2017 there were eight general compliance matters and one financial compliance matter outstanding. The matters relate to: professional conduct; general breaches of legislation; trust account misappropriation; failure to act in the best interest of the principal; and unlicensed activity.



While there were no key substantive trends in the department’s interaction with the settlement industry, it did deal with a number of settlement agents who voiced concerns about soft market conditions causing added financial pressures.

Settlement agents have been undertaking e-conveyancing for more than two years and it has proved to be reliable and effective. The department continues to support settlement agents to manage business change and reform internal processes. The move to mandatory paperless conveyancing will involve a number of challenges and opportunities for the industry including reducing resistance to change and eliminating the system’s perceived complexity.


The department will continue to assist the industry with the proposed changes to the withholding tax on foreign residents selling property. These changes will apply to contracts entered into on, or after 1 July 2017 for real property disposals where the contract price is $750,000 and above. The withholding tax on foreign residents’ rate will also change from the existing rate of 10 per cent to 12.5 per cent. The existing $2 million threshold and 10 per cent rate will still apply for any contracts entered into before 1 July 2017 even if they are not due to settle until after 1 July 2017.

Australian resident sellers of real property with a market value of $750,000 or above must apply for a clearance certificate to ensure no funds are withheld from their sale proceeds. The department’s support will include a range of training initiatives and provision of educational material. The department will continue to resource proactive compliance with an aim to visit all settlement agents every three to four years.

(e) any proposals for improving the operation of the Commissioner.

The introduction of the new Settlement Agents Code of Conduct 2016 makes the code consistent, where appropriate, with the other property industry codes and the Australian Consumer Law. The department will continue to provide educational support to the industry for the new code.

Travel Agents Act 1985

Travel agents were previously regulated by the Travel Agents Act 1985 and the Travel Agents Regulations 1986. This legislation set out a licensing regime and industry standards to protect consumers from inadequate service or financial loss arising from failure to pass on funds to suppliers and/or insolvency of the travel agent. This also required travel agents to participate in a national Travel Compensation Fund scheme.

The national deregulation of travel agent licensing across Australia came into effect in Western Australia on 8 October 2014 and resulted in the Travel Compensation Fund ceasing to operate. Subsequently, the Travel Agents Act 1985 was repealed on 25 January 2017.

Although travel agents are no longer required to be licensed, Consumer Protection continues to monitor the industry in cases where agents have ceased trading and consumers have been impacted, such as with Azberg Pty Ltd trading as Global Plus Holidays in July 2016. The department also accepts complaints in regard to allegations of misconduct that may fall within the provisions of the Australian Consumer Law and assists consumers through conciliation.



EnergySafety Division

Electricity Act 1945

Section 33 of the Electricity Act 1945 requires the Director of Energy Safety (the Director) to report on a number of matters, namely:

(a) the number, nature, and outcome, of the -

(i) investigations and inquiries undertaken under this Act by, or at the direction of, the Director; and

The following numbers of investigations and inquiries were concluded in 2016–17

Table 34: Electricity Act 1945: Investigations and inquiries concluded in 2016–17

Nature Number

Audits 2

Compliance inspections 4,236

Investigations - Breaches 298

Total 4,536

Outcomes(1) Number

Appeal rejected 1

Further inspection(s) 2

Further investigation 37

Issue incident report/hazard alert 3

Issue inspectors Order 53

Refer to Electrical Licensing Board 4Licensing Board - Failed competency assessment 1

No further action 3,703

Not inspected 838

Lapsed prosecution 10

Proceed with prosecution 11

Prosecution - Convicted 12Prosecution - No conviction/ dismissed 1

Prosecution - Withdrawn 3

Infringement 6

Project goal delivered 134

Provide advice 39

RCDs inadequate. Advice given 19

Stop Sale Notice 2

Verbal warning 4

Written warning 78

Total 4,961

Note:(1) Compliance actions may take more than one year to

complete. Therefore the outcomes recorded above may relate to investigations carried out in an earlier year. Also there can be more than one compliance action for an investigation.

(ii) matters that have been brought before the State Administrative Tribunal under this Act by the Director.

There were no such matters.




Table 35: Electricity Act 1945: Number and nature of matters outstanding for 2016–17

Nature Number

Audit (Network Operator) 0

Compliance inspection 1,284

Investigation 175

Total 1,459


During the year EnergySafety engaged three electrical inspectors on fixed term contracts to assist in the inspection of electrical installing work carried out by electrical contractors. This initiative reduced the backlog of outstanding inspections by 39 per cent while also addressing the new inspections required under its sample inspection system.

EnergySafety has not been able to fill its full time vacant senior electrical inspector positions. In addition two contracted senior electrical inspectors resigned and one senior electrical inspector and two managers retired during the year.

EnergySafety has continued to prioritise its workload based on risk assessment and some work was not completed. This also resulted in some investigations taking longer to complete than planned. In 10 cases EnergySafety could not complete the investigation within the two year statutory limitation period.

(d) forecasts of the workload of the Director in performing functions under this Act in the year after the year to which the report relates; and

The downturn in the State’s resources sector and the fall in construction activity have not eased EnergySafety’s workload. Work demand trends thus far show no sign of abating and appear to continue into 2017–18.

The growth of licensed operatives in Western Australia is expected to decrease slightly when compared to previous years. The

number of notices for completed work each year to electricity network operators and EnergySafety is expected to increase, as in past years.

EnergySafety’s inspection and investigation workload is unlikely to decrease.

The number of outstanding and lapsed investigations and compliance inspections will grow unless EnergySafety can recruit inspectors to fill the vacant positions.

(e) any proposals for improving the performance of the Director’s functions under this Act.

The trend for serious accidents resulting from ‘live’ work has shown a slight increase over recent times and EnergySafety, in conjunction with WorkSafe, is working on new legislation to address the issue.

The department will persist in its attempt to recruit technical staff to fill the vacant positions.

EnergySafety has developed and implemented a Compliance Management System (CMS). CMS provides a basic platform for managing all of EnergySafety’s compliance functions. During the next financial year it is intended to enhance this basic platform and introduce improved functionality that should increase work efficiency.


Gas Standards Act 1972

Section 13CA of the Gas Standards Act 1972 requires the Director of Energy Safety (the Director) to report on a number of matters, namely:

(a) the number, nature, and outcome, of the -

(i) investigations and inquiries undertaken under this Act by, or at the direction of, the Director; and

The following investigations and inquiries were concluded in 2016–17

Table 36: Gas Standards Act 1972: Investigations and inquiries concluded in 2016–17

Nature Number


Compliance inspection 451

Investigations 1,058

Total 1,522

Outcomes(1) Number

Appeal rejected 2

Appeal upheld 13

Appeal withdrawn 2

Corrective Action Request 1

Further investigation 11

Infringement 45

Inspectors Orders cancelled 13

Issue Inspectors Order 10

No further action 776

Not gas related 5

Not inspected 14

Not investigated 25

Proceed with prosecution 1

Provide advice 4

Variation/Exemption approved 21

Verbal warning 441

Written warning 200

Total 1,584

Note:

(1) Compliance actions may take more than one year to complete. Therefore the outcomes recorded above may relate to investigations carried out in an earlier year. Also there can be more than one compliance action for an investigation.

(ii) matters that have been brought before the State Administrative Tribunal under this Act by the Director.

There were no such matters.


Nature Number


Compliance inspection 62

Incident investigation 141

Total 2,23


There were no trends or special problems that emerged.

(d) forecasts of the workload of the Director in performing functions under this Act in the year after the year to which the report relates; and

There were no forecasts of the workload of the Director.

(e) any proposals for improving the performance of the Director’s functions under this Act.




Government policy requirements

Commitment to reconciliation

The department is committed to maintaining positive relationships with Aboriginal and Torres Strait Islander communities through the strategies outlined in its Reconciliation Action Plan 2014–2016. These strategies addressed Reconciliation Australia’s key focus areas: relationships; respect; and opportunities, through the development of initiatives for the education of employees and customers, and liaison with Aboriginal support groups.

Table 37: Summary of the key activities undertaken during 2016–17 in support of the department’s Reconciliation Action Plan

Area of focus: Relationships

• Celebrated Aboriginal and Torres Strait Islander culture and significant events by promoting and encouraging staff engagement in the reconciliation process.

• Informed departmental business areas about the identity of key Aboriginal and Torres Strait Islander stakeholders. A list of key stakeholders was developed and maintained for the department and is promoted on the Aboriginal Portal.

Area of focus: Respect

• Increased the knowledge and raised staff awareness of Aboriginal and Torres Strait Islander culture and history.

• Highlighted key Aboriginal community organisations and their work towards addressing social disadvantage through our fundraising activity casual dress days, and contributed the raised funds back to the community groups.

• Delivered cultural awareness training to provide an opportunity for staff to engage and contribute when working with Aboriginal or Torres Strait Islander employees. Wider exposure and understanding of the culture is vital to creating pathways and new ways of working with Aboriginal or Torres Strait Islander people.

Area of focus: Opportunities

• Continued to create opportunities for Aboriginal and Torres Strait Islander participation and employment within the department through a partnership with the Public Sector Commission Aboriginal Traineeship Program.

• Provided opportunities and encouraged staff at level 7 and above to participate in the Jawun Secondment Program to share their skills and experience and support Aboriginal and Torres Strait Islander people and organisations in the East and West Kimberley of Western Australia.

Aboriginal and Torres Strait Islander recruitment, retention and career development

It is the department’s commitment to empower, support and develop its people by respecting individuality and diversity, both internal and external to the organisation, as stated in the department’s Aboriginal Employment Strategy 2013–2015 (the Aboriginal Employment Strategy). The Aboriginal Employment Strategy contains three key action areas: workplace environment; attraction and recruitment; and retention and career development.

The department continues to work towards its target of 3.2 per cent Aboriginal and Torres Strait Islander employment and as at 30 June 2017, 1.5 per cent of the department’s employees identified as Aboriginal or Torres Strait Islander.

Table 38 provides a summary of the key activities undertaken during 2016–17 in support of the department’s Aboriginal Employment Strategy.

http://www.commerce.wa.gov.au/publications/reconciliation-action-plan-2014-2016

http://www.commerce.wa.gov.au/publications/reconciliation-action-plan-2014-2016

http://www.commerce.wa.gov.au/publications/aboriginal-employment-strategy-2013-2015

http://www.commerce.wa.gov.au/publications/aboriginal-employment-strategy-2013-2015


Table 38: Summary of the key activities undertaken during 2016–17 in support of the department’s Aboriginal Employment Strategy

Key action area: Workplace environment

• A culturally inclusive work environment establishes a foundation for Aboriginal people to feel confident in their ability to perform their job in a culturally safe and secure environment. The department will continue to enhance and develop initiatives that will create and maintain a culturally inclusive workplace to support Aboriginal people, ultimately leading to higher retention and job satisfaction levels for Aboriginal employees.

• Cultural awareness training is implemented to ensure that staff engagement and participation levels increase and we continue to build upon current knowledge and experiences staff may have with Aboriginal people and the impacts of social disadvantages when working with Aboriginal employees or the community.

Key action area: Attraction and recruitment

• The department will directly focus on efforts to recruit Aboriginal youth through the Aboriginal Traineeship Program in partnership with the Public Sector Commission. This includes looking at innovative ways to become more active in preparing Aboriginal people for public service jobs. Invested recognition to develop a better relationship with the Aboriginal community will empower all individuals to acquire skills to participate effectively at all levels.

• We will continue to participate in the Future Footprints Career Expo aimed at youth in the higher education system to widen our exposure to promote our department and attract Aboriginal youth into our workforce.

Key action area: Retention and career development

• The final key action area focuses on effective retention measures that enhance both the employment continuity and career development within the department to support employees with pathways to progress into leadership roles. The department’s Aboriginal informal mentoring program has successfully connected our Aboriginal staff with the Aboriginal trainees commencing within our department to provide advice and guidance in their career development and pathway.

The Aboriginal Employee Committee (Committee) was established in 2014 for Aboriginal employees to provide support and advice on recruitment, retention and career development for Aboriginal staff to the department. In November 2015 the Committee changed its name to the Moorditj-Kart, Yakiny-Djooritj, Kanangoor-Mila (MYK Committee). This was a significant step for the MYK Committee that is reflective of the Aboriginal staff and their commitment to Aboriginal employment. The meaning of the name for the MYK Committee is ‘strong minds standing together for a brighter future.’

Substantive equality

In accordance with the Equal Opportunity Act 1984 and the Public Sector Commissioner’s Circular 2015-01: Substantive Equality (Implementation of the Policy Framework (Addressing systemic discrimination in service delivery), the department is committed to ensuring substantive equality is reflected appropriately in divisional operations, strategies and policies.

The department’s Substantive Equality Committee is responsible for monitoring the Policy Framework for Substantive Equality to assess client needs. The Committee has placed emphasis on enhancing service delivery to Aboriginal and other culturally diverse client groups through the provision of specific information and education resources to ensure equal outcomes.

The department was also represented on a number of cross-government networks and committees including:


https://publicsector.wa.gov.au/document/public-sector-commissioners-circular-2015-01-implementation-policy-framework-substantive-equality





• National Indigenous Consumer Strategy Implementation Reference Group; and

• Disability Services Commission State Government Networking Group.

Progress against the Policy Framework continues through the review of current policies and projects and maintaining effective communication networks with relevant Indigenous community organisations.

Occupational safety, health and injury management

In accordance with the Public Sector Commissioner’s Circular 2012-05: Code of Practice: Occupational Safety and Health in the Western Australian Public Sector (the Circular), the department complies with the requirements of the Occupational Safety and Health Act 1984,, the Workers’ Compensation and Injury Management Act 1981 and the Code of Practice: Occupational Safety and Health in the Western Australian Public Sector.

The department’s commitmentThe department recognises the value of its employees and is committed to providing a safe and healthy work environment focused on the prevention of injury and illness. It recognises the importance of effective occupational safety, health (OSH) and injury management systems and practices and relies on the active participation and cooperation of both management and employees to achieve this.

The department also recognises the vital role that senior managements’ commitment to effective occupational safety, health and injury management processes plays in the development of a strong safety and injury management culture aimed at best protecting the health and safety of its employees. It is committed to raising awareness of safety and health obligations and promoting safer work practices.

Consultation mechanismsManagement and employees are committed to improved and effective consultation in the workplace. Consultation provides employees with an opportunity to participate fully in decisions which impact on their working lives. The establishment of an appropriate forum for consultation has resulted in better decision making, leading to more effective implementation. The department maintains an Occupational Safety and Health Committee (the Committee) which comprises safety and health representatives and management representatives and is focused on the continuous improvement of occupational safety and health performance.

In 2016–17 the Committee met every six weeks to discuss workplace matters that affect the safety, health and wellbeing of employees. During the year the Committee discussed and resolved issues raised by employees, reviewed policies and procedures, reviewed controls and measures to ensure that hazards were addressed to eliminate or reduce potential issues, and discussed injury trends and identified preventative measures which promote a safe working environment.

Injury management systemThe department strives to prevent injuries at work occurring through raising awareness of safety and health obligations and promoting safe work practices, however, in the unfortunate event of a workplace injury occurring, it has an established injury management system, which details the steps taken to assist injured employees return to work as soon as medically appropriate.

The department’s injury management system is compliant with the requirements of the Workers’ Compensation and Injury Management Act 1981 and the Workers’ Compensation Code of Practice (Injury Management) 2005 and ensures the establishment of an official return to work program for any employee of the department injured while at work for when they are able to return to work in either a partial or total capacity.

Information regarding the department’s OSH and injury management systems are available to employees on a dedicated ‘OSH Toolkit’

https://publicsector.wa.gov.au/document/public-sector-commissioners-circular-2012-05-code-practice-occupational-safety-and-health-wa-public-sector














page found on the department’s intranet site. Additionally, information is communicated as part of OSH training for employees, managers and supervisors and through the Committee.

Our performanceTo ensure the effectiveness of the department’s OSH management system it is evaluated each year through an OSH and Wellbeing Survey. The 2017 OSH and Wellbeing Survey, was launched in February 2017 by the Director General.

The aim of the survey is to gauge current safety and health culture and level of awareness within the department so that strategies for improvement could be identified and incorporated into the OSH Improvement Plan 2017–18.

On the whole the survey responses demonstrated a positive safety and health culture within the department; with the major highlights as follows:

• 90 per cent of staff reporting that they had been provided adequate written instructions about the safety and health aspects of their role;

• 94 per cent of staff agreed that safety and health issues are acted upon within a reasonable time;

• 95 per cent of staff agreed that incidents and hazards are always investigated and followed up;

• 70 per cent of participants felt that their understanding of OSH had improved over the past 12 months (this was a 16 per cent improvement over the past 12 months);

• 94 per cent of participants felt the department was supportive towards the management of both work and non-work related injury/medical conditions;

• 99 per cent of participants advised that they would take action against an unsafe work practice by either reporting it and/or saying something directly to the person; and

• 97 per cent of participants were aware of their legal responsibilities relating to OSH (i.e. report hazards, follow safety instructions).

The department provides OSH training to employees in accordance with the Occupational Safety and Health Act 1984. The OSH Induction is mandatory for all new employees within four weeks of commencement. This training covers ergonomics, manual handling, bullying, hazard identification and risk assessment, legislative requirements, the Committee, duty of care and the functions of a safety and health representative.

OSH and injury management training is provided to all managers and supervisors. This training covers the requirements of managers and supervisors set by their legal obligations for OSH and injury management in addition to the management of workplace hazards and risks, development of return to work programs and common issues that may impact a person’s fitness for work. Attendance to this training is reported as a key performance indicator for each division within the department and is mandatory for all managers and supervisors, with refresher training undertaken every three years.

AchievementsIn May 2017 the department was awarded a WorkSafe Platinum Certificate of Achievement for its OSH Management System. The WorkSafe Plan Certificates of Achievement are awarded to organisations that have had an independent assessment of their workplace safety and health practices undertaken and have achieved high ratings in each element of the WorkSafe Plan, in addition to having rates of work-related injury and disease that are reducing, or being kept at low levels.

In receiving the Platinum level of certification, the department received a score of 100 per cent for three of the five elements assessed – management commitment, consultation and training. It also scored 99 per cent for the remaining two elements, hazard and risk management and planning.




In June 2017 the department was announced as a finalist for the Mentally Healthy Workplace Award by the Western Australian Association for Mental Health. The Western Australian Mental Health Awards (Awards) aim to recognise and reward the achievements of those who demonstrate initiatives inspiring others and promoting positive mental health in supporting consumers of mental health services, their families and carers.

The department was awarded second runner up at the Awards which were held in July 2017.

Table 39: Occupational safety, health and injury management performance

MeasureActual Results Results Against Target

2014–15 2015–16 2016–17 Target Result

Number of fatalities 0 0 0 0 (zero) On target

Lost time injury and/or disease incidence rate 0 0.134 0.25(1) 0 or 10%

reduction See note below

Lost time injury and/or disease severity rate 0 0 0 0 or 10%

reduction On target

Percentage of injured workers returned to work:

i) within 13 weeks N/A 100% 100%

Actual percentage

resultOn target

ii) within 26 weeks N/A 100% 100% On target

Percentage of managers trained in occupational safety, health and injury management responsibilities

100% 100% 100%

Greater than or equal to

80%

On target

Note:

(1) During 2016–17 there were two compensable non-severe lost time injury claims that have been finalised.

Whole of Government Public Sector Safety and Injury Management Initiative

The Public Sector Safety and Injury Management Initiative provides a whole of government approach to workplace safety and injury management. The initiative supports a commitment by all Australian jurisdictions to the achievement of the Australian Workplace Health and Safety Strategy 2012–2022.

The initiative is an example of how the public sector can work together to develop a culture that advocates and supports a workplace free of work-related injuries and diseases. The initiative is designed to promote the Western Australian public sector as a leader in safety, health and injury management by fostering a coordinated approach across public sector agencies. The department is the lead agency responsible for the initiative.

A steering committee was established to foster senior management commitment and provide guidance to public sector agencies. The steering committee has senior officers from the department, the Public Sector Commission, RiskCover, WorkCover WA and a UnionsWA nominee.

The key activities of the initiative include identifying and developing strategic initiatives to assist agencies to improve safety and injury management performance and thereby reduce workers’


compensation costs. The initiative also promotes best practice safety, health and injury management across the public sector through the Code of Practice: Occupational Safety and Health in the Western Australian Public Sector and the Public Sector Commissioner’s Circular 2012-05: Code of Practice: Occupational Safety and Health in the Western Australian Public Sector (the Circular).

Key activities undertaken by the department in support of the initiative in 2016–17 included:

• There was one Public Sector Occupational Safety, Health and Injury Network session held November 2016 on Creating and Maintaining Psychologically Healthy Workplaces. In addition to providing participants with: the current workers’ compensation statistics; industry trends; the results for the WorkSafe work-related stress project 2014–15; and a number of case studies; the forum covered:

• OSH and injury management systems – an award winning example of what a good OSH and injury management system looks like presented by Ray Lucas, Department of Transport;

• how employers can identify and manage risk factors to psychological health and comply with OSH obligations presented by Justine Mcgillivray, WorkSafe; and

• strategies and interventions to promote well-being/reduce stress presented by Dr Ali Burston, Organisational Psychologist.

• The promotion of inclusion of workplace safety, health and injury management activities in Chief Executive Officer performance agreements.

• Co-sponsorship of the special workplace safety and health and injury management reporting award for the 2015–16 reporting year at the W.S Lonnie Awards held in March 2017.

• Participation, as the Western Australian representative, in several National Workplace Safety, Health and Injury Management forum teleconferences to share and disseminate

information inter-jurisdictionally on public sector workplace health and safety and injury management best practice.

• Continued review of compliance with the Circular which saw a further improvement in the number of public sector managers and supervisors who received training in occupational safety, health and injury management responsibilities and overall compliance with OSH and injury management reporting experienced an upward trend.

Customer feedback

The department is committed to understanding and striving to exceed our customer service standards by encouraging customer feedback to improve our services. Customers can provide feedback in a number of ways including via the internet, by telephone, by informing our counter service employees, or by written communication to the department. The feedback recorded is used to understand our customer expectations, determine the extent to which we can deliver on these expectations, address systemic shortfalls which will improve our service delivery, streamline our processes and acknowledge the good efforts of our employees.

The department has a Customer Service Policy as required by the Public Sector Commissioner’s Circular 2009-27: Complaints management. The department’s performance in relation to customer feedback is monitored by the Corporate Executive.

In 2016–17 the department received 92 pieces of feedback via its online customer service feedback form. Of these, 32 per cent were compliments; 15 per cent were suggestions and 53 per cent were complaints.

http://www.commerce.wa.gov.au/publications/code-practice-occupational-safety-and-health-western-australian-public-sector

http://www.commerce.wa.gov.au/publications/code-practice-occupational-safety-and-health-western-australian-public-sector

Disclosures and legal compliance

Documents

Transcript of Disclosures and legal compliance